Bitcoin Spot Volumes Remain High Despite Price Lockdown

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The data shows that Bitcoin spot trading volumes have remained at high values ​​over the past week, despite the price moving mostly sideways.

Bitcoin spot trading volumes stabilized above $10 billion

According to the latest weekly report from Arcane Research, volumes usually drop when the price of BTC starts to fluctuate. “Daily Trading Volume” is an indicator that measures the total amount of Bitcoin traded on Bitwise 10 exchanges on a given day.

Even though the metric only considers Bitwise 10 trades, the indicator can still be used as a decent proxy for the trend across the entire spot market. These platforms also provide the most reliable data in the industry, so the picture they paint is more accurate than simply assessing data from the entire market.

When the value of this metric is high, it means that investors are currently moving large amounts on spot exchanges. Such a trend shows that traders are currently active in the market.

On the other hand, the low values ​​suggest that BTC spot exchanges are not seeing much activity at the moment. This type of trend may be a sign that there is not much trading interest around cryptocurrency currently.

Now, here is a chart that shows the trend of Bitcoin’s 7-day average daily trading volume over the past year:

Looks like the value of the metric has been quite high for the past few days | Source: Arcane Research’s Ahead of the Curve – January 31

As shown in the chart above, Bitcoin’s 7-day average daily trading volume surged about three weeks ago to values ​​exceeding $10 billion as the price of the asset saw a sharp rise.

It is not uncommon for the spot market to become very active when the price sees rapid action, as a volatile market is what excites many investors and encourages them to make certain trades. It is also this new activity that maintains rallies like these, as a large number of active traders are needed to sustain such moves.

There have been sharp price movements in the past that have not accompanied significant increases in Bitcoin trading volume for an appreciable period of time, and therefore naturally died out after only a short while. the price of BTC returning to low volatility. again afterwards.

Moreover, trading volumes usually decrease when the price starts to oscillate and becomes “boring” for investors. Over the past three weeks, however, the indicator has remained at roughly the same level above $10 billion, despite the fact that the value of the cryptocurrency has been stuck in consolidation for the past week or so. .

The lack of a noticeable slowdown in market activity could be a positive sign for Bitcoin’s current upward push, as it shows that there is still sustainable ground for the rally to recover.

BTC price

As of this writing, the price of Bitcoin is hovering around $22,900, up 1% in the past week.

Asset value continues to move sideways | Source: BTCUSD on TradingView

Featured image by Andr François McKenzie on Unsplash.com, charts by TradingView.com, Arcane Research

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