Bitcoin and Altcoin Spot Trading Volume is Decreasing

Low Trading Volume in the Bitcoin Market Raises Concerns

Spot trading volumes for Bitcoin and altcoins have dropped to their lowest levels since November 2023, signaling weak demand. According to Glassnode data, although prices have shown an increase, the weak fundamentals of the market are noteworthy.

Low liquidity can amplify price movements. Shallow order books can lead to sharp rises or falls in the markets due to relatively small trades. This dynamic was highlighted temporarily by a CoinDesk study following the collapse in October.

The depth of the crypto market has not fully recovered since the $19 billion liquidation event that occurred in October. This leaves the markets more vulnerable to exaggerated price fluctuations and sudden reversals.