Bitcoin breaks above $22,000 as whales show buying activity on Coinbase
Bitcoin has broken above $22,000 again as on-chain data shows signs of whales buying BTC on Coinbase recently.
Bitcoin Coinbase Premium Gap has been very positive lately
As pointed out by an analyst in a CryptoQuant post, the Coinbase Premium Gap has increased in recent days. “Coinbase Premium Gap” here is an indicator that measures the difference in the Bitcoin price listed on the cryptocurrency exchange Coinbase and that listed on Binance.
Coinbase is popularly known to be more used by US-based investors (especially institutional holders), while Binance receives a more global traffic. This means that the premium gap can provide insight into which of the two user bases is providing more buying pressure (or selling pressure) to the asset right now.
When the value of the indicator is negative, it means that the price listed on Coinbase is currently lower than on Binance. This suggests that Coinbase users have sold more (or simply bought less) than the global users recently.
On the other hand, a positive premium gap implies that US investors are buying the asset more heavily than the world’s user base at the moment as the price of Coinbase is higher.
Now, here is a chart showing the trend of the Bitcoin Coinbase Premium Gap over the last couple of weeks:
Looks like the value of the metric has been pretty high in recent days | Source: CryptoQuant
As shown in the graph above, the Bitcoin Coinbase Premium Gap had been around neutral values for most of the past two weeks, but after BTC plunged to around $19,500, the value of the metric started to see some rapid increase.
This increase suggests that when BTC hit the low prices, whales on Coinbase started buying large amounts of the cryptocurrency, pushing the price higher on the exchange.
These high values have continued since then, suggesting that the buying pressure on the platform has not fallen relative to the activity on Binance.
After the Coinbase Premium Gap hit these highs, the price also stopped falling further. And in the last 24 hours, Bitcoin has even observed a rapid uptrend, which can confirm that whales are indeed buying heavily on Coinbase, and the prize gap is not just due to a smaller number of sales from US-based investors compared to global holders.
BTC may continue to see further bullish momentum if the prize gap remains at high values and whales continue to buy. The quant also notes in the post that if the whales intend to keep the rally going, then the asset is also unlikely to fall below the $19,500 level anytime soon, as that is where the indicator’s value first started to observe the increase.
BTC price
At the time of writing, Bitcoin is trading around $22,000, down 2% in the last week.
The value of the asset seems to have surged over the past day or so | Source: BTCUSD on TradingView
Featured image from Hans Eiskonen at Unsplash.com, Charts from TradingView.com, CryptoQuant.com
