Finance

Bitcoin’s Rebound? Coinbase Premium, ETF Inflows, and Historical Patterns Hint at Market Turnaround

August 26, 2025, 4:30 PM

A conceptual illustration of a large red arrow pointing down through a silver Bitcoin coin and cracking the ground, symbolizing a market crash.

A conceptual illustration of a red arrow piercing a Bitcoin coin and causing a crack, symbolizing a severe price crash in the cryptocurrency market. By Miami Daily Life / MiamiDaily.Life.

Executive Summary

Bitcoin is showing signs of a potential market rebound, with analysis suggesting it is “getting closer to the bottom” despite recent volatility and over $700 million in crypto long liquidations.

The Coinbase Premium Index has returned to positive territory, indicating stronger buying pressure and a potential recovery in U.S. demand for Bitcoin.

Spot Bitcoin ETFs recorded unexpected positive net inflows of nearly $220 million on Monday, countering the underlying BTC price decline and general market uncertainty.

The Story So Far

Bitcoin’s recent price dip and volatility, characterized by significant liquidations, are being interpreted by analysts as a potential market bottom due to a positive shift in the Coinbase Premium Index indicating renewed U.S. demand, unexpected resilience in spot Bitcoin ETF inflows despite price declines, and historical parallels suggesting a forthcoming short squeeze.

Why This Matters

The confluence of a positive Coinbase Premium Index signaling renewed U.S. demand, unexpected resilience in spot Bitcoin ETF inflows amidst price declines, and historical parallels to previous market retracements collectively suggests Bitcoin may be nearing a bottom. This indicates a potential market rebound, highlighting sustained investor interest and the possibility of a short rally despite recent volatility.

Who Thinks What?

Market analysts and popular traders, such as BitBull and Mister Crypto, suggest that Bitcoin is nearing its bottom and anticipate an impending shift, a short rally, or a short squeeze, supported by a positive flip in the Coinbase Premium Index.

Analyst Cas Abbe notes that current Bitcoin price action mirrors a previous retracement observed in June, indicating a potential similar market pattern.

Spot Bitcoin ETF investors demonstrated resilient demand by recording nearly $220 million in positive net inflows, even as the underlying BTC price declined.

Bitcoin is showing signs of a potential market rebound, with recent analysis suggesting its current dip mirrors previous price behavior, supported by a positive flip in the Coinbase Premium Index and an unexpected surge in spot Bitcoin exchange-traded fund (ETF) inflows. The cryptocurrency consolidated around $110,000 at Tuesday’s Wall Street open, following a period of volatility that saw over $700 million in crypto long liquidations.

Market Volatility and Potential Bottom

Bitcoin’s price volatility cooled after a fresh round of losses, which led to significant liquidations across the crypto market. BTC/USD bottomed at $108,717 on Bitstamp, falling below previous all-time highs. Despite the downturn, popular trader BitBull noted that BTC is “getting closer to the bottom,” suggesting an impending shift.

Coinbase Premium Signals US Demand

A key indicator, the Coinbase Premium Index, has returned to positive territory, raising hopes for a recovery in U.S. demand. This index measures the price difference between BTC/USD on Coinbase and BTC/USDT on Binance, with a positive value implying stronger buying pressure from the U.S. market. BitBull further concluded that “max. pain is here” and anticipated a short rally.

Surprising ETF Inflows Counter Downturn

In a notable development, spot Bitcoin ETFs recorded positive net inflows on Monday, totaling just under $220 million, despite the underlying BTC price decline. This unexpected inflow countered a period of souring sentiment often associated with price drawdowns and macro uncertainty.

Historical Parallels and Short Squeeze Expectations

Analyst Cas Abbe suggested that the current price action bears a resemblance to a retracement observed in June, when BTC/USD reached $112,000 before dropping to approximately $98,000. Additionally, Mister Crypto anticipated a short squeeze, attributing it to a significant build-up of short positioning in the market.

Overall, while Bitcoin has experienced recent price volatility and significant liquidations, a confluence of factors—including returning U.S. demand signals via the Coinbase Premium, resilient ETF inflows, and analytical comparisons to past market behavior—suggests that the market may be nearing a turning point and preparing for a potential rebound.