Forget Bitcoin ETFs—Asia’s Liquidity War With US Will Dictate BTC’s Future

Move over, ETFs—the real battle for Bitcoin's soul isn't happening on Wall Street.

Liquidity Tug-of-War Goes Global

Asian markets ramp up crypto trading volumes while US regulators drag their feet. Hong Kong and Singapore carve out 24/7 trading corridors that leave New York looking sluggish. Retail and institutional money floods into Asian exchanges, seeking friendlier regulations and higher leverage options.

Regulatory Arbitrage Becomes Strategy

Smart money already bypasses bureaucratic hurdles by routing through Asian hubs. The result? Trading pairs and liquidity pools that operate while Americans sleep. This isn't about nationalism—it's about capital finding the path of least resistance.

Western institutions scramble to catch up while Asian platforms build the infrastructure for the next bull run. The irony? Those same US firms that once dismissed crypto now beg for permission to play in a game others are winning.

Bitcoin doesn't care about borders—it follows liquidity. And right now, that flow is heading east.

Bitcoin’s True Catalyst

According to the latest report shared by CryptoQuant, on-chain and exchange data make this pattern clear. Asia often lights the initial spark with aggressive trading activity, while the United States decides whether that spark ignites into an uninterrupted rally.

Coinbase netflows serve as a reliable proxy for institutional appetite, as consistent outflows indicate long-term accumulation by entities based in the US.

Further validating this is the Coinbase Premium Index (CPI), which measures the price gap between Coinbase’s USD markets and Binance’s USDT pairs. A positive CPI has historically been associated with durable rallies, as it indicates that US demand is actively supporting higher prices.

On the other hand, Binance netflows reveal Asia’s influence, which is often tied to shorter-term sentiment and retail positioning. Heavy inflows usually foreshadow sell pressure, while outflows suggest active dip-buying.

The Korea Premium Index (KPI), widely known as the “Kimchi Premium” tracking Korean market sentiment, is currently pointing to moderate premiums that indicate healthy demand, but readings above 5% often warn of speculative excess. Together, these indicators reveal not a single dominant driver but a constant balance of power.

When US institutional demand and Asian retail enthusiasm align – as reflected in both CPI and KPI flashing green simultaneously – bitcoin rallies tend to accelerate with global momentum. But when leadership moves between the two regions, markets experience heightened volatility and sharp intraday swings.

This evolving structure challenges the outdated notion that “whales MOVE the market,” demonstrating instead that regional liquidity flows dictate price action.

Looking ahead to Q4, the true catalyst for Bitcoin’s next leg higher will be a decisive positive shift in the Coinbase Premium, coupled with Asia’s continued ability to absorb supply. This synchronization, CryptoQuant believes, could transform sparks into a sustained rally.

Bitcoin Hasn’t Hit Euphoria Yet

Bitcoin’s market sentiment has entered the “faith and optimism” phase, as the Net Unrealized Profit/Loss (NUPL) indicator currently sits at 0.52, which signals a mid-bull cycle. Previously, this 0.5-0.6 range has triggered accelerated price moves, while peaks in 2013, 2017, and 2021 occurred when NUPL hit 0.7-0.8.

Experts say that while short-term profit-taking could set off corrections, the medium-term outlook points to continued upward momentum. If the pattern repeats, Bitcoin could surge toward the $120,000-$150,000 range. Importantly, the asset has not yet entered the “euphoria” zone.