Bitcoin’s price climbed $12K in 2 weeks, but U.S. demand is dropping.
The Coinbase Premium Index fell despite Bitcoin’s rising momentum.
Weak U.S. demand may challenge Bitcoin's ability to maintain its growth.
Bitcoin surged from $94,000 to $106,000 in just two weeks, showing strong momentum, but U.S. demand has weakened significantly. The Coinbase Premium Index, which measures Bitcoin demand on Coinbase compared to global exchanges, has fallen during this rally. This divergence has raised concerns about the rally’s sustainability.
Source: CryptoQuant
U.S. Investor Demand Weakens Amid Bitcoin’s Rise
The Coinbase Premium Index, provided by CryptoQuant, tracks the price difference between Bitcoin on Coinbase and other platforms. It reflects demand from North American investors, and a higher premium usually signals strong U.S. interest in Bitcoin. However, over the last two weeks, the index has dropped while Bitcoin’s price surged.
Analysts have noted that such divergences often occur before price corrections. This trend indicates that North American buyers are not driving the current rally, which could mean the upward momentum may not last. With Bitcoin now at $106,000, questions arise about whether this growth is stable without U.S.-based demand.
Key Factors Driving Market Trends
Major developments in the U.S. crypto market have shaped sentiment. Bitcoin ETFs launched in January 2024, which boosted institutional interest and trading activity. Furthermore, the upcoming U.S. presidential election has created hopes for clearer regulations, making the market more appealing to investors.
Despite these positive factors, the Coinbase Premium Index remains negative. This drop suggests the rally may rely more on global buyers than North American traders. Such reliance raises concerns for analysts because U.S. markets have historically been a critical driver of Bitcoin's long-term growth.
The chart analyzed by CryptoQuant clearly highlights divergence points. Red markers represent times when Bitcoin’s price rose as the premium fell, while green markers show alignment between strong price increases and rising U.S. demand. The most recent pattern includes multiple red markers, signaling that the current rally lacks significant domestic support.
Could Weak U.S. Demand Signal Trouble?
Bitcoin’s rally has sparked optimism, but its divergence from the Coinbase Premium Index signals potential challenges in maintaining momentum. Investors have been closely following this trend since it suggests a possible disconnect between price movement and North American market interest.
According to CryptoQuant's analysis, the divergence could indicate weakening upward momentum. This would be significant since the Coinbase Premium Index has long been considered a reliable indicator of Bitcoin’s medium-term performance.
The question remains whether Bitcoin’s rally can continue without stronger U.S.-based demand, especially as macroeconomic factors like ETFs and election-year developments unfold. CryptoQuant’s findings urge investors to remain cautious and monitor this divergence for signs of a potential market correction.
