The Coinbase Bitcoin Premium Index, which measures the price gap between bitcoin on Coinbase and the global market average, fell to a negative divergence of -0.15%, the widest since the first quarter of this year.
A negative index reading means bitcoin is trading cheaper on Coinbase, signaling weak U.S. demand, selling pressure and a decline in institutional appetite. This trend began after the October 10 crypto liquidation event and persisted throughout November.
This decision comes in the form of bitcoin is on track for its worst week since early March, after falling more than 11% and briefly falling below $81,000 before stabilizing around $84,000. November also saw heavy losses, with bitcoin currently down 23%, marking its worst monthly performance since June 2022, when it fell 38%.
An event of capitulation?
This shift in market sentiment is also visible in U.S. bitcoin spot ETFs, which saw persistent outflows through most of November.
Read more: Bitcoin ETFs lost a record $3.79 billion in November
However, Friday ended that streak with $238.4 million in admissions, the largest since November 11, according to Farside data. It was also a day of record volume, with ETFs collectively trading $11.5 billion according to Bloomberg ETF analyst Eric Balchunas. BlackRock’s IBIT accounted for $8 billion of that total.
Balchunas also noted that IBIT had a record week for put volume, saying “that’s one thing that can help people stay the course, they can still buy puts as a hedge while they stay long.”
Given bitcoin’s 36% decline from its all-time high in October, Friday could represent a high-volume capitulation event, often seen at local low prices. While not guaranteed, the events could signal a potential attempt by BTC to stabilize in the low $80,000 range.
Glassnode data shows more than $4 billion in realized bitcoin losses on Friday, the highest level since March 2023 during the Silicon Valley Bank crisis, another potential data point of capitulation.
Read more: Bitcoin sell-off led by mid-cycle wallets as long-term whales hold on: VanEck
