Bitcoin’s Coinbase premium has remained negative for seven days, indicating weaker demand in the US spot market as year-end selling in the West contrasts with steady Asian dip buying.
Summary
- The Coinbase Bitcoin premium has been negative for seven consecutive days, indicating that US spot prices are trading at a discount to the global average
- Year-end portfolio rebalancing, profit taking and tax loss harvesting are putting pressure on US flows, while Asian traders are accumulating BTC during intraday dips.
- Similar buying patterns in the US and Asia in 2019, March 2020 and late 2022 ultimately preceded higher prices as Western selling pressure was exhausted.
The Coinbase premium has remained negative for seven straight days, indicating weaker demand for cryptocurrency in the United States compared to other global markets, according to data from Coinglass.
The premiumwhich measures the price difference between Bitcoin (BTC) and other crypto assets traded on the US-based Coinbase exchange compared to major alternatives such as Binance, was also negative for most of November, the data showed.
A negative Coinbase premium typically indicates that U.S. spot demand is lagging other markets, due to reduced institutional buying activity and more cautious capital deployment, market analysts said.
The measure serves as a sentiment indicator for institutional and retail demand in different regions. If positive, it indicates strong buying pressure from US investors, especially institutional buyers who often use Coinbase. A negative reading indicates that US investors are selling or showing less buying interest compared to other regions.
Year-end portfolio dynamics may be contributing to this trend, with institutions rebalancing their portfolios, taking profits and engaging in tax loss harvesting as the fiscal year ends, market observers said. While such activity is typical in December, the magnitude was greater this year, analysts noted.
Asian markets appear to be exhibiting opposite behavior, with traders in the region buying during price declines while US and European traders sell, trade data shows.
Similar patterns have emerged during previous market cycles, including in 2019, March 2020 and late 2022, when Western selling was followed by Asian accumulation. In those cases, prices eventually went up as a result of Asian buying activity.
Over the past two weeks, liquidation events have led to declines in the cryptocurrency market during late U.S. trading hours, followed by accumulation during Asian morning trading sessions, market data shows.
