Data shows that spot bitcoin trading volume is back to the normal 2022 values after the recent surge.
Bitcoin trading volume drops to values of around $4 billion
According to the latest weekly report from obscure researchBitcoin trading volume is down again after the recent highs.
The “Daily spot trading volume“It is an indicator that measures the total amount of bitcoin that is moving on the chain on any given day.
When the value of this metric goes up, it means that the number of coins circulating on the network is increasing. This trend could be a sign of the growing interest in cryptocurrency among investors right now.
On the other hand, a downtrend in volume indicates that market activity is declining. This trend may indicate that public interest in cryptocurrencies may be waning.
Historically, the index’s high values have provided a favorable environment to drive big moves in the bitcoin price.
The reason behind this is that to sustain any such movement, a large number of active traders (which correspond to large volumes) are needed.
Now, here is a chart showing the trend in bitcoin trading volume (7-day average) over the past year:
Looks like the value of the metric has plunged down recently | Source: Arcane Research's The Weekly Update - Week 20, 2022
As you can see in the chart above, the volume of Bitcoin has been jump sharply to high values of just under $10 billion recently.
These were spikes not observed since May last year. However, the value of the index has already plummeted, registering only about $4 billion now.
This value is more in line with the normal for 2022 thus far, but is still a historically low value, as it has been during the rest of the year.
The report notes that this sharp shift in trading volume illustrates how quickly market activity for Bitcoin can fluctuate.
In general, during periods of low activity, the price of the cryptocurrency tends to move sideways. So, looking at the current values, you might follow a similar result for the coin now as well.
At the time of writing this report, Bitcoin price It is floating around $29.5K, down 1% in the last week. Over the past month, the cryptocurrency has lost 25% of its value.
The chart below shows the currency price trend over the past five days.
It seems like the price of BTC has continued to move sideways over the last few days | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, Arcane Research