What do you call a market that constantly ignores the headlines that usually bring it down? They call it resilient with strong support for underlying demand.
That’s the story for bitcoin in recent weeks, as the cryptocurrency held firm around $70,000 even as the Iran war rages, oil prices rise and the Fed’s bets on rate cuts evaporate. This type of challenge screams optimism.
But wait, some key indicators are still going in the wrong direction, demolishing that bullish interpretation.
The first indicator is Coinbase Premium, which measures the price difference between bitcoin on Coinbase, a Nasdaq-listed exchange, and offshore giant Binance. Typically, a strong positive premium means that US institutional investors are bidding more aggressively than their global counterparts. A strong Coinbase premium has appeared regularly during bull runs, including bitcoin’s first run to $100,000 in late 2024.
But right now, Coinbase Premium is at its most negative level in over a month, according to data source Coinglass. In other words, BTC is trading at a discount on Coinbase, indicating relatively weaker demand from US investors. The discount reappeared on March 19 and has been growing since then.
Another key indicator – bitcoin ETF inflows, which is also an indicator of institutional demand – has been disappointing lately.
The 11 U.S.-listed spot bitcoin ETFs recorded net inflows of $1.53 billion this month, ending a three-month streak of outflows, according to SoSoValue. But almost $1.3 billion arrived in the first half, and since then the pace has slowed considerably to just $195 million. Analysts have repeatedly emphasized that strong and consistent inflows are crucial for Bitcoin prices to gain bullish momentum.
Vikram Subburaj, CEO of India-based Giottus Exchange, put it best: “The sign here is that institutional demand has not gone away. However, it is selective and less linear than in stronger accumulation phases.”
At the time of writing, bitcoin changed hands at around $70,000, according to data from CoinDesk.
