Crypto ‘winter’ slows volume on some of the biggest exchanges

[ad_1]

Some of the more popular cryptocurrency exchanges are starting to notice what could be a troubling sign: Individual investors are heeding the industry mantra of ‘hodl’ and avoiding trading as digital asset prices fall. ‘worsen.

FTX.US, the US subsidiary of the eponymous trading juggernaut, saw declining transaction volumes “across the board” last week, FTX.US chairman Brett Harrison said in an interview. “To me, it looks like we are in the period of just declines in volume and moderate business activity following declines in general.”

After the price drops, “usually you will see a lot of rapid volume from people trying to sell during a panic, but then a longer period of volume declines as people turn away from the market after the volatility”, Harrison said. There needs to be “more confidence” from retail investors for the return of crypto trading volumes, he said.

Coinbase Global, Inc., the largest crypto exchange in the United States, also saw a decline in daily Bitcoin spot volumes over the past week, during which Bitcoin fell from around $ 47,000 to $ 40,634. Coinbase shares closed at $ 232, up from $ 357 in November.

Trading fees make up the majority of Coinbase’s income. Coinbase shares fell after reporting lower than expected third-quarter income in November, due to lower coin prices and lower trading volume.

“Falling prices could lead to a drop in trading volume when it happens to discourage traders from engaging. It is possible that the price of digital assets will stagnate, like entering a crypto winter after falling prices.” said Owen Lau, analyst at Oppenheimer & Co.

While it’s possible that the first quarter will be another “crypto mini winter,” there appears to be an upward trend as digital asset adoption continues, Lau said. The prices could also drop so much that they look cheap and keep buyers coming back.

Mike Novogratz, CEO and founder of Galaxy Digital Holdings, told CNBC yesterday that he is waiting a bit longer to buy crypto. Today, as Bitcoin hovers at $ 41,990, he tweeted that “We have entered the buy zone.”

This story was posted from an agency feed with no text editing. Only the title has been changed.

Subscribe to mint newsletters

* Enter a valid email address

* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our app now !!

[ad_2]