Bitcoin (BTC) has demonstrated remarkable momentum in this market cycle, yet recent analyses suggest that liquidity sources beyond Coinbase are significantly influencing the trend. A detailed examination by CryptoQuant analyst Mignolet sheds light on the pivotal roles played by major exchanges such as Coinbase and Binance in the ongoing bull cycle.
Shifting Liquidity Dynamics and Exchange Roles
In a recent analysis posted on the CryptoQuant QuickTake platform, titled “Coinbase Dominance Remains Low,” Mignolet explored the trajectory of Coinbase’s influence on Bitcoin’s price movements. The analysis revealed that while Coinbase was crucial in the initial stages of this year’s Bitcoin rally, its dominance has since diminished. This trend signifies a broader distribution of liquidity across the market landscape, with Binance emerging as a significant force in maintaining the bullish momentum.
Decreasing Influence of Coinbase
According to Mignolet, Coinbase’s dominance in spot trading has markedly declined during the second phase of Bitcoin’s ongoing rally. Notably, the approval of Bitcoin exchange-traded funds (ETFs) earlier this year spurred a surge in trading activity on Coinbase. This influx of liquidity was instrumental in driving Bitcoin prices upward, disrupting traditional halving cycle expectations. However, as the rally advanced, Coinbase’s influence waned.
Rise of Binance in the Liquidity Arena
The analysis underscores that while Coinbase remains a crucial liquidity source, Binance has taken on a more prominent role in the current market phase. Mignolet emphasized that Binance’s growing dominance suggests liquidity flows from a broader array of participants, contributing to a somewhat decentralized and robust market structure. This redistribution could indicate broader institutional and retail interest in Bitcoin, as traders and investors diversify their platforms.
Bitcoin Sees a Sharp Rebound
After experiencing a brief correction that saw its price dip below the $95,000 mark, Bitcoin has staged a sudden rebound. At the time of writing, the asset has reclaimed the $100,000 price milestone, with a current trading price of $100,625. This marks a 4% increase in its value.
Approaching All-Time Highs
This price surge has brought Bitcoin tantalizingly close to its all-time high, now only 3.6% away from surpassing the $103,000 record set earlier this month. Such a rebound underscores the dynamic nature of Bitcoin’s market and the potential for further upward movement.
