Bitcoin
Coinbase Premium Discount Could Signal ‘Splendid’ Six to 12 Months for Bitcoin, Says FalconX Analyst
The head of research at cryptocurrency exchange FalconX believes that the coming months will see the return of volatile bullish moves for Bitcoin (BTC).
David Lawant says on social media platform X that the current discount in Coinbase’s BTC premium is reminiscent of conditions in August 2023, when Bitcoin was trading around $25,000 before starting a rally to record highs near $74,000.
“Always darkest before the dawn?
According to my calculations, the last time the Coinbase premium was this negative was a few months before the big rally from October 2023 to March 2024.”
Source: David Lawant/X
The Coinbase Bitcoin Premium Index tracks the percentage difference between the price of BTC on Coinbase Pro and its price on the Binance cryptocurrency exchange. Coinbase primarily serves U.S. customers, including large institutions, while Binance serves a more global customer base.
A premium Coinbase index with deep discounts indicates weak buying pressure from US investors, a condition that has coincided with Bitcoin price lows in the past.
According to Lawant, the coming months will likely see Bitcoin shoot to new heights as he believes American investors will eventually return and bid up BTC.
“Something tells me the next six to 12 months are going to be splendid – and probably volatile. We’ll see!”
Last month, macroeconomics guru Raoul Pal he said that crypto is approaching the “Banana Zone” or a period of sustained uptrend for digital assets. He noted that politicians tend to “hand out candy” in the form of stimulus packages during elections, leading to higher inflation and in turn, higher prices for Bitcoin and crypto.
“Look, the final quarter of an election year is a real banana zone for all assets. It always is. So you know there’s a very, very, very high probability that by the fall things are going to be rocky.”
I mean, how long before ETH, Bitcoin [and] SOL breaks its recent highs? Could be two weeks. Could be two months. Doesn’t really matter, but then it speeds up.”
At the time of writing, Bitcoin is worth $62,113.
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