A recent on-chain analysis suggests that Bitcoin is once again showing divergence between investor groups, specifically between institutional players and retail investors. According to this analysis, Bitcoin price may have more room to grow than we have seen so far this cycle.
Bitcoin ETF flows are consistent with Coinbase Premium indicator readings
Recently Quick post On the CryptoQuant platform, cryptocurrency research and education firm XWIN Research Japan delves into the dynamics of the Bitcoin market noting the emergence of a decisive structural shift.
The relevant indicators in this analysis are Bitcoin Spot ETF’s total inflows, the Coinbase Premium Index, and the Fear and Greed metrics. ETF inflows measure the net amount of bitcoins moving into or out of spot ETFs; Coinbase Premium tracks the price difference between Coinbase and other exchanges.
According to XWIN Research Japan, ETF and Coinbase Premium inflows (~0.56) show a positive correlation indicating inflows are aligned with spot demand. However, XWIN Research Japan points out an important difference: institutional buying actually precedes ETF inflows, not the other way around, as is commonly believed. Hence, rising values from Coinbase Premium indicating that US investors are buying again are the primary drivers of Bitcoin price.
The Fear and Greed Index reveals the persistent fear of fragmentation
Conversely, a set of analyzes suggests that the Fear and Greed Index tells a less optimistic story. Experts highlight that the index is still very low, with readings still in the 10-30 range, indicating that retail traders are still out of action.
This “marginalization” of retail traders may be rooted in their recent losses, while institutional investors continue to hoard money due to “flow and structure.” Therefore, this behavior creates the classic “wall of anxiety” spike, where the price of the cryptocurrency (Bitcoin, in this case) rises despite widespread market uncertainty.
Thus, XWIN Research Japan explains, this could ultimately mean that the market is in the early or even mid-stage of an “institution-led uptrend,” where retail participation is effectively exempt from factors driving prices. In a scenario where retail activity rebounds with mostly bullish intent, the flagship cryptocurrency could see further upside.
As of press time, Bitcoin is worth $75,703, and CoinMarketCap data shows that the world’s leading cryptocurrency has lost 2.24% of its value over the past day.
