Bitcoin trading volume continues to remain unusually low
The data shows that Bitcoin trading volume has been unusually low recently, and market activity remains subdued.
Bitcoin’s 7-day average spot trading volume remains below $4 billion this week
According to the latest weekly report from Arcane Research, the trading volume of BTC has seen a slight increase over the last week, but the value is still very low compared to last year.
“Daily trading volume” is an indicator that measures the total amount of Bitcoin involved in transactions on a given day.
When the value of this metric increases, it means that now a larger amount of BTC is watching movement on the chain. This shows that the market is becoming more active.
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On the other hand, decreasing volume may suggest that the market is becoming more inactive. Such a trend may imply that interest in cryptocurrencies among investors is declining.
Now, here is a graph showing the trend of Bitcoin transaction volume over the last year:
It seems that the value of the metric has stagnated in recent weeks | Source: Arcane Research Weekly Update – Week 16, 2022
As you can see from the chart above, Bitcoin’s seven-day average daily trading volume has been very low recently. Currently, the value of the indicator is less than 4 billion dollars.
These low values have been around for a while as the price of cryptocurrencies is stuck in consolidation.
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This week, the metric saw a slight increase from the previous week, but BTC volumes nonetheless remained among the lowest of last year.
Historically, low trading volumes were not adequate to support large price movements, as the market needs a large number of active traders to sustain these movements.
Recently, the price of Bitcoin attempted a rally, but it wasn’t long before the jump fizzled out as the volume didn’t pick up with it.
Such prolonged low volumes are unusual for BTC, and at this time it is not very clear when the high values can return to cryptocurrencies.
Today, the price of Bitcoin fell again after a brief rally yesterday, as at the time of writing, the coin was trading around $38.8000, down 7% from last week.
Over the last month, the cryptocurrency has lost 12% in value. The chart below shows the price trend of the coin in the last five days.
The price of Bitcoin seems to have fallen in the last twenty four hours | Source: BTCUSD on TradingView Featured Image from Unsplash.com, Charts from TrdaingView.com, Arcane Research
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