Basis and premium

In cryptocurrency, basis refers to the difference between the actual trading price of a cryptocurrency and its fair value. If the actual trading price of a cryptocurrency is lower than its fair value, it is called basis indicating that the cryptocurrency is undervalued in the market. Conversely, if the actual trading price is higher than the fair value, it is called premium indicating that the cryptocurrency is overvalued in the market.

Basis and premium are important indicators in the cryptocurrency market, reflecting the market supply and demand dynamics and overall perception of traders towards a particular cryptocurrency. They can be influenced by various factors, including market liquidity, investor sentiment, differences among trading platforms, and so on.