Bitcoin Price Linked To Binance Vs Coinbase Battle, Quant Reveals
14 Maio 2024 - 10:00PM
NEWSBTC
A quant has explained how there appears to be a relationship
between Coinbase’s spot volume dominance vs. Binance’s and the
Bitcoin price. Bitcoin Has Been Reacting To Binance/Coinbase Volume
Changes In a CryptoQuant Quicktake post, an analyst discussed the
dynamics in the cryptocurrency market that arise out of the battle
happening between Binance and Coinbase for spot volume dominance.
Related Reading: Newbie Bitcoin Whales Buying 200,000 BTC Per Week,
Data Shows The quant shared a chart below that shows how this war
for dominance has played out over the past decade. As the graph
shows, Binance has been the much more dominant of the two platforms
when considering the spot volume. The exchange is hosting five
times as much volume as Coinbase. The analyst notes that the
difference between the two would be even higher when considering
the BTC-FDUSD pair, which isn’t included in the data depicted in
the above chart. Despite the much lower spot volume, Coinbase still
hasn’t been irrelevant in the market. For example, the platform is
the custodian for Bitcoin spot exchange-traded funds (ETFs) like
BlackRock’s IBIT and Grayscale’s GBTC. There also appears to be an
interesting pattern between the dominance of the American exchange
and the Bitcoin spot price. The quant has highlighted this trend in
the graph. There have been a few instances where a rise in the spot
trading volume of Coinbase against Binance has preceded surges in
the value of cryptocurrency. Similarly, declines in the platform’s
dominance have seemingly led to drawdowns in the Bitcoin price. The
analyst has also discussed the trend in the volumes of the two
exchanges more closely, using the spot volume ratio for them, as
shown below. The chart shows that the spot volume ratio between
Binance and Coinbase had spiked to very high levels in 2023, with
the former’s volume being 53 times the latter’s. The reason behind
this was the zero-fee scheme that Binance had introduced for the
Bitcoin trading pairs. However, Coinbase’s volume has recently
risen, although the ratio remains notably in favor of Binance. This
shift in the market emerged as the Bitcoin spot ETF-related news
started to intensify. Related Reading: Bitcoin Will Be Set For New
ATHs If It Breaks This Resistance: Analyst The quant concludes: The
dynamics between these exchanges are complex, but the graphs show
that each exchange’s dominance at specific times has a direct
impact on the price of Bitcoin. It’s a true battle between the
market’s biggest players, where competition is constant, and the
outcome is reflected in cryptocurrency movements. BTC Price At the
time of writing, Bitcoin is trading at around $61,800, down 3% over
the past week. Featured image from Kanchanara on Unsplash.com,
CryptoQuant.com, chart from TradingView.com
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