Data shows Bitcoin trading volume on Binance has now dropped to levels not seen since before the fee was removed.
Bitcoin’s 7-Day Average Trading Volume On Binance Continues to Fall
According to the latest weekly report from Arcane Research, the market has seen a significant decrease in activity. “Daily trading volume” is an indicator that measures the total amount of Bitcoins transacted on any point exchange on a given day.
Arcane Research’s general spot market trading volume metric is based on total transfers on Bitwise 10 exchanges. While this exchange does not cover the entire market, its volume data is the most reliable of all exchanges, and its activity is still a reasonable approximation of trends in throughout the market.
While the trading volume on this exchange is high, it means that many coins are currently being transferred in the spot market. The trend indicates the current active traders. On the other hand, low values indicate that BTC activity is currently low as investors make small moves on the spot exchange.
Now, here’s a chart showing the trend in the 7-day average Bitcoin trading volume for Binance and the rest of the Bitwise 10 exchanges separately:
Looks like the 7-day average value of the metric for Binance has been going down recently | Source: Arcane Research's Ahead of the Curve - January 3
The reason why the volume of Binance points is shown separately from other exchanges is that the platform implemented a zero-fee policy for BTC pairs last summer, which led to an explosive growth in the volume, and the exchange soon surpassed all others. the market is integrated.
However, much of this increase in volume may be due to wash trades, as no fees mean that high volume trading strategies are now feasible. Still, there is also some organic improvement in activity, as some investors will leave other exchanges for Binance after the change.
As you can see in the chart, trading volume on Binance reached its peak around November last year but has since declined. Most recently, the indicator has reached its lowest value since crypto exchanges removed their fees.
There is also very little activity in other markets today as combined volumes remain at low levels. The report notes that the market participation that is in the market may be due to the holiday season.
The price of BTC
At the time of writing, Bitcoin is trading around $16,800, up 1% over the past week.
The value of the crypto seems to have sharply risen in recent days | Source: BTCUSD on TradingView.com
Featured images from Kanchanara on Unsplash.com, charts from TradingView.com, Arcane Research