The Bitcoin spot trade volume is back to its normal level for 2022, according to data. This comes after the huge surge that occurred recently.
In Bitcoin, the Volume of Trading Drops to Values around $4 Billion
According to the Arcane Research weekly report, Bitcoin trading volume dropped after recent highs.
The “daily spot trading volume” is an indicator that measures the total amount of Bitcoin moving on the chain on any given day.
If this metric increases in value, that means more coins are being exchanged on the network. Investors are increasingly interested in crypto, and this trend could indicate that there is a rising interest.
A downtrend in volume could indicate that there is less market activity. This could mean that there is less interest in crypto.
High values of this indicator historically have created a favorable climate for large movements in Bitcoin’s price.
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It is necessary to have a high volume of active traders in order to support any type of move (high volumes are correlated to this).
Below is a chart which shows how Bitcoin volume has changed over the past 12 months.
It looks like the value for the metric is falling recently. Source: Arcane Research's The Weekly update - Week 20-22, 2022| Source: Arcane Research's The Weekly Update - Week 20, 2022
The graph above shows that Bitcoin’s trading volume has risen sharply to high levels of just under $10 billion.
These highs were not seen since May last year. However, the indicator’s value has already plummeted down, clocking just about $4 billion now.
While this value is closer to the average for 2022, it is still lower than the historical norm. This was also true during the remainder of the year.
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This sharp increase in trading volume is a sign of how quickly the Bitcoin market can shift, according to the report.
In general, crypto prices tend to move sideways during times of low activity. Given the current value of the crypto, it is possible that a similar result could be expected for the coin.
BTC price
At the time of writing, Bitcoin’s price floats around $29.5k, down 1% in the past week. The crypto’s value has fallen 25% over the past month.
Below is a chart showing the change in coin price over the past five days.
BTC seems to have continued its sideways movement over the past few days. Source: BTCUSD at TradingView| Source: BTCUSD on TradingView
Unsplash.com featured image, Charts from TradingView.com and Arcane Research charts