Bitcoin Tops $85K As Coinbase Premium Stays Negative

This Monday, the price of the main crypto approached 86000 dollars, its highest level since the end of January. However, this recovery remains imperfect, as US spot demand has not yet shown strength comparable to that of the price.

Bitcoin Price Reaches Eight-Month High

Bitcoin has just crossed 85000 dollars before approaching 86000 dollars, with a nearly 6% increase over 24 hours. Indeed, the crypto now shows a gain of more than 30% since its low point on August 19.

This increase comes despite two major obstacles. The US Federal Reserve raised its main key interest rate by 25 basis points, a decision generally unfavorable to risky assets. Moreover, the CLARITY Act, which was intended to clarify US crypto regulation, also failed to gain the necessary votes in the Senate.

Some key data help to understand the magnitude of this move :

• Bitcoin reached its highest level in eight months ;
• Its increase was around 6% over 24 hours ;
• The gain exceeds 30% since August 19 ;
• The loss recorded since January fell below 3% ;
• The Coinbase premium still showed -0.02 at the CryptoQuant reading.

This rebound has also benefited companies related to the sector. Thus, Coinbase gained nearly 5% on the stock market, while Strategy’s stock rose by around 8%. Such a reaction reveals that the renewed interest does not exclusively concern the spot market.

The Coinbase Premium Remains Slightly Negative

The Coinbase Premium Index is the main weakness identified. It is an indicator that measures the gap between the bitcoin price on the Coinbase dollar market and that observed on the BTC-USDT pair of Binance.

A positive premium usually signals that bitcoin trades at a higher price on Coinbase. It thus indicates relatively stronger demand from American investors, notably companies and institutional players. A negative value, on the contrary, indicates weaker demand or higher selling pressure on the American platform.

According to CryptoQuant, the index fell to -0.02 when bitcoin was still around 81500 dollars. It had briefly exceeded zero before returning to negative territory.

This reading predates the move toward 86000 dollars. However, it does not necessarily describe the exact situation at the peak of the session. Its weakness nevertheless reveals that the increase was not yet supported by sustained outperformance of acquisitions made on Coinbase.

A value really close to zero does not immediately announce a bearish reversal. The desired confirmation would rather be a premium that becomes positive again, stays above zero, and rises in parallel with the crypto price.

ETFs and Position Buybacks Support the Rise

Other sources support the progression. Spot Bitcoin ETFs from BlackRock and Fidelity reportedly amassed nearly 433 million dollars on Friday. These inflows help absorb bitcoins sold by some long-term holders.

The closing of short positions amplified the move. More than 658 million dollars of short positions were liquidated in one day across the entire crypto market. Bitcoin accounted for nearly 367 million dollars of this total. These forced buybacks accelerated the rise, without constituting sustainable demand by themselves.

Meanwhile, Strategy resumed its purchases after a three-week pause. The company acquired 950 bitcoins for 75.7 million dollars, at an average price of 79670 dollars. It now holds 846,000 BTC, acquired for 63.8 billion dollars.

These factors explain why the price can rise despite a negative Coinbase premium. Demand related to ETFs, company acquisitions, and liquidations on derivatives operate through different channels.

Bitcoin Still Needs to Confirm Its Recovery

Matt Hougan, Chief Investment Officer at Bitwise, believes that the market has entered a “crypto spring”. He even projects the bull cycle as “the most powerful and longest” in the sector’s history. This statement remains an anticipation, not a guarantee about BTC’s trajectory.

The strength of the rebound will now depend on three signals. Thus, the Coinbase premium must sustainably move back above zero, ETFs must maintain positive flows, and bitcoin must defend the zone between 80,000 and 85,000 dollars after the wave of liquidations.

Maintaining above 85,000 dollars would consolidate the scenario of a recovery fueled by spot acquisitions. Conversely, a quick retreat accompanied by ETF outflows could indicate that the move to 86000 dollars was mainly based on closing short positions.