- BTC’s Coinbase Premium Gap has increased since the beginning of the year.
- This shows that there is more demand for the coin on Coinbase than on Binance.
In the first few days of 2024, institutional interest in Bitcoin has increased [BTC] on Coinbase, with the exchange’s Premium Gap reaching new highs, CryptoQuant analyst Maartunn noted in a new report.
BTC’s Coinbase Premium Gap compares the price at which the coin trades on Coinbase to the price at which it trades on Binance. When it rises, it means investors are willing to pay a premium to acquire the coin on Coinbase.
According to Maartun:
“This premium fluctuates, ranging from a few dollars to more than $50, underscoring the robust purchasing activity.”
This comes amid Binance’s recent struggles in the US and the global decline in its market share as a result.
Binance vs Coinbase
AMBCrypto reported previously that Binance had a spot trading market share of 65% in early 2023, while Coinbase lagged a distant second with around 8.2%.
As regulatory pressure on the exchange increased over the year, its market share plummeted by 20%, and by December Binance’s market share had fallen to around 44%.
The recent rise in BTC’s Coinbase Premium Gap could lead institutional investors to focus on the leading coin ahead of a possible approval of a spot ETF.
According to Maartun, the growth of this metric has “fueled speculation about whether MicroStrategy is acquiring additional Bitcoin or whether these purchases are part of preparations for an ETF approval.”
In December 2023, a series of predictions surfaced that the US Securities and Exchange Commission (SEC) would grant its initial approval on January 10.
However, a report published on January 3 by crypto investment services provider Matrixport stated that the regulator would reject all applications because they “do not meet a critical requirement that must be met.”
In recent news, Jacquelyn Meline, a senior reporter at TechCrunch, confirmed the possibility of approvals for “multi-company applications” coming very soon.
heard from sources very close to the matter that the bitcoin spot ETF will be approved by the SEC for applications from *multiple* companies
— Jacquelyn Melinek (@jacqmelinek) January 4, 2024
Read BTC price forecast for 2023-2024
That’s not all
In addition to the Coinbase Premium Gap, BTC’s Coinbase Premium Index (CPI) has also been on an upward trend since the beginning of the year. According to data from 0.095 at the time of writing, it has risen 2% since then CryptoQuant.
Source: CryptoQuant
The CPI is a metric that measures the difference between the price of an asset on Coinbase and on Binance. When an asset’s CPI value is positive and in an uptrend, it indicates strong buying pressure among institutional investors on Coinbase.