Bitcoin premium index turns positive: Is the "barometer" of U.S. funds quietly shifting?

After a long negative value period lasting 29 days, the Bitcoin premium index, which has attracted much attention from the market, has finally returned to positive territory, currently reported at 0.0132%. This not only ends the longest "negative premium era" of the year but also seems to be a subtle signal suggesting that the sentiment of institutional funds dominated by the U.S. market may be undergoing a change.

1. What is the premium index? Why is it so important?

In simple terms, the Bitcoin premium index is a metric that measures the difference between the Bitcoin price on Coinbase, the largest compliant trading platform in the United States, and the average price on other exchanges worldwide. When its value is positive, it means that the price on Coinbase is higher, which is often interpreted as the purchasing power of the U.S. market, especially that institutional funds and compliant funds denominated in dollars are actively entering the market. Conversely, a negative value indicates greater selling pressure in the U.S. market or weak buying willingness, with funds showing an outflow trend. Therefore, this index is regarded as an important micro indicator for observing "smart money" and institutional sentiment.

The Coinbase Bitcoin Premium Index, regarded as a "sentiment barometer" for the cryptocurrency market, has recently attracted market attention due to recording a positive value of 0.0645% on June 9, 2025, followed by a negative value of -0.0145% on August 31 of the same year.

Historical data shows that negative values of this indicator often signal price bottoms, such as the 50% increase in Bitcoin after negative values in November 2022. The continuous negative values during May-June 2024 coincided with market consolidation, and in October 2024, an extreme value of -0.1493% was observed. This phenomenon is often accompanied by special events such as ETF fund flows and government asset disposals.

What does a negative value lasting for 29 days mean?

The record-long negative values clearly depict the conservative stance of the U.S. market during a previous period. This may be the result of multiple overlapping factors: the repeated postponement of market expectations for Fed rate cuts, the persistence of a high interest rate environment, and the uncertainty of macroeconomic data, all of which have put pressure on risk assets. Institutional investors often choose to wait and see or reduce holdings in such an environment, leading to weaker buying power on Coinbase compared to other global markets, resulting in a negative premium. During this time, market confidence is undoubtedly relatively weak and sluggish.

3. At this time, what kind of signal has been released by the regularization?

Although the value of 0.0132% is very small in itself, the symbolic significance of its "turning positive" action is far greater than the value itself. It may indicate that:

1. Institutional buying starts to return: After nearly a month of digestion and observation, some institutional investors may believe that the Bitcoin price has entered an attractive range and have begun to tentatively accumulate positions. This sense of "no more decline" is often the first step in the recovery of market sentiment.
2. Emotional rebound from the bottom: Market sentiment is cyclical. After prolonged pessimism and sell-offs, any positive catalyst (such as improving inflation data or ETF fund inflows) could trigger a sentiment reversal. A positive premium index is a direct reflection of this sentiment shift from extreme pessimism to neutrality.
3. The leading role of the US market may be restored: As the main battleground for compliance and institutionalization, the reflow of funds into the US market is crucial for the healthy and steady rise of Bitcoin prices. If the positive premium can be sustained and expanded, it will greatly boost the overall confidence of the global market.

Future Outlook

The Bitcoin premium index has turned positive, which can be seen as a "spring awakening" after the market's continuous freezing point. It reminds us that when the market is filled with pessimism, the flow of funds may be quietly changing.

However, we still need to remain cautiously optimistic. A single day's data turning positive is not sufficient evidence for a trend reversal; we need to observe whether it can be sustained and consolidated.

Investors should closely monitor the capital flows of the US Bitcoin spot ETF, the policy trends of the macro economy, and the subsequent trends of the premium index itself.

If the premium can steadily strengthen accompanied by an increase in trading volume, then this small "barometer" may indeed be indicating that a new round of institution-driven market activity is brewing.

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