Bitcoin has recently shown a recovery back above the $68,000 mark. Here’s who could be behind this rally, according to on-chain data.

As pointed out by an analyst in a CryptoQuant Quicktake post, the Coinbase Premium Gap has been declining alongside the recent price rise. The “Coinbase Premium Gap” here refers to an indicator that keeps track of the difference between the Bitcoin prices listed on Coinbase (USD pair) and Binance (USDT pair).

When the value of this metric is positive, it means the price of the asset is currently higher on Coinbase than Binance. Such a trend suggests the buying pressure is higher or the selling pressure is lower on the former than the latter.

On the other hand, the indicator being negative implies the users of Coinbase may be participating in a higher amount of selling than the Binance ones as BTC is trading at a lower rate on there.

Now, here is a chart that shows the trend in the Bitcoin Coinbase Premium Gap over the last couple of days:

As displayed in the above graph, the Bitcoin Coinbase Premium Gap has had a negative value recently, which implies the Binance users have been willing to pay more for the asset than Coinbase customers. Earlier in the past day, the indicator had even plunged to a low of around -106, which suggests the coin was briefly trading at a premium of $106 on Binance. From the graph, it’s apparent that this buying push on the exchange had coincided with the start of the latest leg up for BTC.

Binance is a platform that’s used by investors around the world, while Coinbase heavily caters to US-based holders, especially the large institutional entities. As such, the Coinbase Premium Gap can be looked at as a reflection of how the American whales differ in behavior from the global investors.

In much of 2024, Bitcoin has closely followed this indicator, suggesting that the US-based institutional investors have been the primary drivers in the market. The latest trend, however, has clearly diverged from this pattern, as it seems the buying from the Binance users is what has been inducing the uptrend.

The quant notes that this trend doesn’t mean that demand from American entities has reduced. “Over the past two weeks, demand for U.S. Bitcoin spot ETFs has surged, with a net inflow of approximately 47,000 Bitcoin,” explains the analyst.

Most of the spot ETFs use Coinbase as their custodian, so movements related to these funds can end up having an impact on the Coinbase Premium Gap. But as the metric has remained negative regardless of the recent inflows, it seems demand from the Binance whales has simply been outweighing the US demand.

At the time of writing, Bitcoin is trading around $68,700, up 2% during the last 24 hours.

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