Buying pressure appears to be mounting in Bitcoin markets, according to the so-called ‘Coinbase Premium’, which measure the difference in BTC’s. Therefore, while Bitcoin has waffled over $49,000 over the last few days, definitive movement over $50,000 could be imminent. At press time, the price of Bitcoin on Coinbase was $47,288.80; this was roughly $60 more than its price on Binance, where the price was $47,228.40.
Coinbase’s price data plays a particularly important role in the short-term movements of Bitcoin because of the large amounts of retail users that use Coinbase.
Therefore, price movements on Coinbase may be a good indicator of what retail investors are doing (or about to do) across the board: when prices on Coinbase are relatively low, the premium moves lower; when prices are higher on Coinbase, retail investors may be looking to buy.
However, the Coinbase Premium has not been consistently strong over the last 24 hours, a sign that traders are watching to see if Bitcoin will fall further or if there is enough momentum to get past $50,000.
A recent report by CoinTelegraph cited a Tweet by CryptoQuant Chief Executive, Ki Young Ju, who said that: “[Bitcoin] breaking 50k looks pretty tough as Coinbase premium becomes -$45.” In other words, the price of Bitcoin was roughly $45 lower on Coinbase than on Binance. CryptoQuant publishes a chart called the ‘Coinbase Premium Index’, which measures the difference in Bitcoin price between Coinbase Pro and Binance.
Breaking 50k looks pretty tough as Coinbase premium becomes -$45
— Ki Young Ju 주기영 (@ki_young_ju) February 14, 2021
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At the time, Ki Young Ju wrote that “buying power doesn’t come from Coinbase. No more Coinbase premium compared to Binance/Huobi/OKEx. Be careful.”
However, now the tides seem to have turned. But, for how long?
“It’s Going to Take a Few Tries.”
Some analysts believe that Bitcoin could be over $50K by the end of the day. Anthony Pompliano seemed to anticipate that Bitcoin would go to $50K already on Sunday, February 14th. “Today feels like a good day for Bitcoin to break $50,000,” he wrote.
However, others believe that it may be a little while. Twitter user @Mandrik wrote that investors should “savor the buildup to $50k #Bitcoin – it’s going to take a few tries. The release will be epic, and likely trigger the next big wave.”
Savor the buildup to $50k #Bitcoin – it's going to take a few tries. The release will be epic, and likely trigger the next big wave.
— Mandrik (@Mandrik) February 12, 2021
Either way, BTC’s proximity to $50K seems to have attracted the attention of a number of large-scale investors in the United States and abroad. After Tesla announced a $1.5 billion investment last week, whispers of investments by Apple, Microsoft and other large companies have also appeared in the news.
As such, Finance Magnates reported that Hester Peirce, a Commissioner at the US Securities and Exchange Commission, has declared an urgent need for clear cryptocurrency regulations.
In an interview with Reuters Peirce praised the involvement of a new generation of investors in financial markets. However, she said that it is still too early to draw policy conclusions from the recent WallStreetBets-driven rallies in GameStop Inc (NYSE:GME) and other stocks.