Bitcoin Spot volume remains stable, but Binance’s share grows
Data shows that Bitcoin spot trading volume has remained stable over the past week, but Binance’s dominance of it has grown further.
Binance’s Bitcoin trading volume dominance is around 96%
According to the latest weekly report from Arcane Research, BTC trading volume has remained stable at around $10 billion for the past week. “Daily Trade Volume” is an indicator that measures the total amount of Bitcoin being transacted on the Bitwise 10 exchanges on a given day.
The calculation only includes the volumes from the Bitwise 10 exchanges because they are known to provide the most reliable data in the market. Although they are not all the platforms there are in the sector, their trading volume trend can still give a decent picture of the trend of the wider market.
When the value of the indicator is high, it means that a large number of coins are currently being moved around the spot market. Such a trend can be a sign that traders are active in the market.
On the other hand, low values suggest that the Bitcoin spot market is observing low activity right now. This type of trend may mean that there is not much interest in the asset among investors at the moment.
Now, here is a chart showing the trend of the 7-day average daily trading volume for Bitcoin over the past year:
The 7-day average value of the metric seems to have been quite high in recent days | Source: Arcane Research's Ahead of the Curve - February 14
As shown in the graph above, the 7-day average daily trading volume for Bitcoin has been at elevated values of around $10 billion over the past week. However, as is clear, a large majority of this volume is located on the cryptocurrency exchange Binance alone.
In the spot market excluding Binance, the indicator has had a value of only $390 million in the past seven days, which is the lowest the calculation has been since January 7, 2023.
This means that 96% of the total trading volume on the Bitwise 10 exchanges was contributed by Binance recently. The reason behind this growth is that volumes on exchanges such as Coinbase, Kraken and Bitstamp have taken a hit during this period.
Usually, when the price of Bitcoin trades sideways, the trading volume tends to fall as investors usually find it boring to consolidate markets and therefore they don’t tend to make too many moves. Since BTC is showing old movement at the moment, it is not a surprise that volumes are not too high in most exchanges.
As for why Binance’s volumes are still so strong that the platform is gaining more dominance, the report explains, “rotation from BUSD to USDT via Binance’s BTC pair may explain part of the elevated Binance volume over the past month, as both BTCBUSD and BUSDUSDT- the pair has seen elevated volumes on the back of the Paxos news.”
BTC price
At the time of writing, Bitcoin is trading around $22,100, down 4% in the last week.
Looks like BTC has continued to consolidate recently | Source: BTCUSD on TradingView
Featured image from Kanchanara on Unsplash.com, Charts from TradingView.com, Arcane Research
