Data shows that the bitcoin carnage has awakened a dead trading volume that has been going on for several months now.
Bitcoin trading volume rose to the highest value since December
According to the latest weekly report from obscure researchThe latest bloodbath in the crypto market has awakened the spot trading volume of BTC.
The “Trading volume“It is an indicator that measures the total amount of bitcoin that is moved on the chain on any given day.
When the value of this metric goes up, it means that the market has become more active as investors are trading larger amounts of cryptocurrencies.
On the other hand, the downtrend in the indicator indicates that Bitcoin market activity is currently declining.
Historically, high trading volumes have been an ideal environment to drive large price movements. This is because to sustain any such movement, a large number of active traders are needed.
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It is also true that any significant price movement attracts more traders in return as interest in Bitcoin increases. Thus, they feed themselves to continue. In cases where the sound did not rise in response to a movement, the movement did not last long before it faded away.
Now, here is a chart showing the trend in BTC trading volume over the past year:
Looks like the value of the metric has surged up recently | Source: Arcane Research's The Weekly Update - Week 18
As you can see in the chart above, bitcoin trading volume has been pretty quiet for a couple of months now.
However, this week the value of the index rose sharply as the market panicked due to Collide in the price of the cryptocurrency.
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On Monday, the daily volume of around $13 billion in Bitcoin moved over the network. This is the highest value on the scale since December 4th.
It now remains to be seen whether the new spot volumes will stay for the next week, or whether the market will go back to sleep again when the sell-off ends.
Bitcoin price It has now collapsed to lower values from the low formed in the summer of 2021. At the time of writing, the coin is trading at around $28.1 thousand, down 28% in the past seven days. Over the past month, the cryptocurrency has lost 29% of its value.
The chart below shows the currency price trend over the past five days.
The value of the crypto seems to have crashed down over the last few days | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, Arcane Research