Bitcoin Coinbase Premium Index falls to $91,300 amid US selling

Bitcoin’s (CRYPTO:BTC) price has recently dropped as U.S. investors show signs of reduced demand, reflected in a sharp fall in the Coinbase Premium Index.

The Coinbase Premium Index, which tracks the demand for Bitcoin from retail investors on Coinbase, has fallen to -0.237, its lowest level since December 2023.

This decline mirrors Bitcoin’s drop to $91,300 at the start of this week, indicating weakening investor interest.

The decrease in demand appears to be influenced by a low-liquidity market during the year-end and increased selling pressure from U.S. investors.

“The index was also affected by a low-liquidity bitcoin market at the end of the year and increasing seller pressure on U.S. soil,” according to Burakkesmeci from CryptoQuant.

The outflows from U.S.-based Bitcoin exchange-traded funds (ETFs) also signal the shift in investor sentiment.

Over the last few trading days of 2024, these ETFs saw a loss of around $700 million, with only $5.3 million in inflows on a single day.

Before Christmas, the spot Bitcoin ETFs saw more than $1.37 billion in outflows, underlining the lack of institutional demand.

Burakkesmeci pointed out that the drop in the Coinbase Premium Index shows “a lack of institutional demand” and highlights a “cautious sentiment” among U.S. investors.

“Such trends can create a challenging environment for Bitcoin’s short-term price recovery unless we see a shift in macroeconomic conditions or renewed interest from institutional or retail buyers,” he stated.

At the time of reporting, the Bitcoin price was $96,737.59.