The trading volume on the exchanges is low as Bitcoin underperforms

Bitcoin continued its sluggish course at the beginning of the second week of January. The market is currently at a 90-day low shortly after the Federal Reserve indicated a rate hike.

So loud report CryptoCompare’s Exchange Review, Bitcoin’s price weakness impacted spot trading volume in December.

“In December, the spot trading volume on the 15 largest exchanges was just $ 1.4 trillion, 22.6% less than in November.”

It happened when Bitcoin recorded its biggest monthly loss in December. This is believed to be the sharpest drop since the asset crashed 49.2% in May 2021 from $ 58,943, which was $ 29,925 left in just 19 days.

BTC is currently trading at $ 41,000 after falling 9.4% last week and 17% last month.

Bitcoin Price Chart | Source: Coinmarketcap

However, in December, CryptoCompare highlighted that spot trading volume on retail exchanges hit a seven-month high, rising 117% to $ 518 billion.

Binance was the exchange with the largest spot volume last month at $ 655 billion. However, the trading volume is still down 29.8% compared to the previous month.

Spot trading volume in the last 3 months of the year on the major stock exchanges | Source: CryptoCompare

Meanwhile a report Other Bloombergs also saw a drop in trading volume on the top exchanges as investors switched to HODL status for the time being.

Owen Lau, Analyst at Oppenheimer & Co. said:

“A sharp drop in prices can lead to a drop in volume as traders no longer have an incentive to enter trades. There is a chance the digital asset will move sideways after the sharp bear market. “

The leading crypto exchange FTX.US also saw lower trading volumes last week. In interview Recently, FTX President Brett Harrison announced:

“We may be in the middle of a decline in volume and trading activity following a major correction.”

Weak price action will cause volume to fall longer after the sell-off subsides. The market now needs “more trust” from private investors.

But instead of optimism, extreme fear is currently dominating the market. In fact, the indicator of fear and greed has already reached the level the shortest since last July.

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