An indicator closely monitored by crypto experts for insights into U.S. institutional investment in bitcoin is known as the Coinbase premium index. Currently, it shows its most extended bullish trend since bitcoin reached all-time highs of over $126,000 in October.
The index has recorded positive numbers for 14 days straight from April 9 to April 22, according to data from Coinglass. This marks the longest consecutive period of positive readings since last October.
Coinbase, listed on Nasdaq and favored by U.S. institutions like corporate treasuries, hedge funds, and ETFs, serves as their primary exchange. A premium price for bitcoin on Coinbase compared to offshore leader Binance indicates aggressive buying by U.S. investors. Historically, strong U.S. investor demand has been a hallmark of bull markets.
Conversely, a negative or zero premium suggests that U.S. interest is waning while offshore markets take the lead. For context, from mid-December to late February, the premium was mostly negative as BTC’s value dropped from around $100,000 to nearly $60,000.
The recent positive trend in the Coinbase premium index is significant as it reflects consistent demand despite geopolitical tensions and a DeFi crisis. This bullish momentum aligns with bitcoin’s recent performance; it surpassed $78,000 on Wednesday, marking a 14% increase for the month.