Battle of the whales as $50K Bitcoin hinges on ‘Coinbase premium’


Data suggests Bitcoin (BTC) has already reached $ 50,000 on some exchanges, but it needs to get the whales to stand by to turn it into eventual support.

In a February 16 tweet, Ki Yong Ju, CEO of CryptoQuant’s Chain Analytics Service, said, Highlighted The so-called “Coinbase premium” as one of the last hurdles for BTC / USD.

The negative installment slows down the upward grinding

On Tuesday, a clear battle emerged within Bitcoin trading as the $ 50,000 remained out of the bulls’ reach.

When analyzing the premium, which places Coinbase’s BTC / USD price against the Binance BTC / USDT pair, Ki argued that until neutralized, higher levels would remain unlikely.

Coinbase Premium for BTC / USD. Source: CryptoQuant

Currently, the premium is negative, which means that it is cheaper to buy Bitcoin on Coinbase. The result is that merchants, especially whales, will continue to accumulate. Once the scale stabilizes, the momentum will appear to be dealing convincingly with the $ 50,000.

“This $ 50,000 fight is about currency base whales (in US dollars) versus stable currency whales (USDT),” wrote Key.

“Coinbase’s negative premium, but an abundance of stablecoins on the exchanges. The negative premium must be cooled to raise another level.”

Stock exchange stabilized currency balances that have reached all-time highs in recent days indicate a willingness to exchange other assets. Meanwhile, the largest stable currency tether (USDT) has accelerated its “minting” in recent months as the market capitalization of USDT is now close to $ 33 billion.

However, at the time of writing, whales were still lining up for sale at $ 50,000 and up. A look at Binance’s order book data showed that incremental sell orders appear every $ 1,000 to $ 55,000.

Buy and sell BTC / USD (Binance) orders. Source: Materials Indicators

No “FUD” on GBTC Premium

Meanwhile, one analyst cautioned against misinterpreting the fall in another premium, this time in institutional investor circles.

Grayscale Premium BTC. Source: Bybt.com

Since the start of 2021, the premium for Grayscale Bitcoin has decreased, the price that investors pay for shares in the Grayscale Bitcoin Trust (GBTC). Far from indicating lower interest in bitcoin, the more competitive buying opportunity is the result of more stocks being available.

“The large GBTC premium in US dollars is a sign of strong demand for bitcoin. Institutional flows into GBTC in US dollars have been one of the biggest drivers of this bull market, so everyone’s eyes are turning to this premium. Now that the premium has collapsed, it has worried many. Market participants, “said Alex Krueger, macro analyst explained on Monday.

“The insurance premium has not collapsed as demand has faltered GBTC Dollars (In the secondary market), but due to the increase in issuance – issues have risen dramatically in the past few months, helping to reduce premiums with a delay. The GBTC Dollars Simply the super trade has become too crowded. “

As Cointelegraph mentioned, Grayscale has been continuously increasing its BTC holdings, and also brought back Ether (ETH) purchases in February after a nearly two-month hiatus. As of February 12, it had $ 31.1 billion Bitcoin assets under management.