Data shows the Bitcoin trading volume spiked up last week as a result of Binance removing fee on its platform.
Bitcoin Trading Volume On Binance Alone Registered $ 11 Billion On 8th July
As per the latest weekly report from Arcane Research, the BTC volume on Binance accounted for 84% of the market’s total on its own.
The “daily trading volume” is an indicator that measures the total amount of Bitcoin that changed hands on the entire network (or any particular exchange) in a day.
When the value of the metric goes up, it means the number of coins being transacted on the chain is increasing right now. Such a trend can show the network is becoming more active.
Related Reading | Stock Market Correlation With Bitcoin Remains High, But Why?
On the other hand, declining volumes can suggest the BTC blockchain is losing activity at the moment. This may be a sign that investors are losing interest in trading the crypto.
Now, here is a chart that shows the trend in the Bitcoin trading volume over the past year:
The value of the metric seems to have shown a spike in recent days | Source: Arcane Research's The Weekly Update - Week 27, 2022
As you can see in the above graph, the 7-day average daily Bitcoin trading volume observed a surge during the past week. However, the report notes that this increase in the indicator’s value didn’t come from organic trading.
Binance removed fees from its platform for selected spot BTC pairs last week to celebrate its 5th anniversary. Many traders indulged in a large amount of wash trading to exploit the removal for getting access to high tier fee rates (which unlock based on the user’s volume).
The metric’s value reached $ 11 billion for Binance on 8th July, which represented 84% of the total volume on the entire BTC network.
While Binance is the largest exchange on the market, its volumes still normally account for around 50-60% of the market total.
The other exchanges observed very little activity during the last week, with their average even approaching the 1-year low. This means that organic trading in the Bitcoin market is still quite muted at the moment.
At the time of writing, Bitcoin’s price floats around $ 20.9k, down 2% in the last seven days. Over the past month, the crypto has lost 4% in value.
The below chart shows the trend in the price of the coin over the last five days.
Looks like the value of the crypto has surged up over the last couple of days | Source: BTCUSD on TradingView
Featured image from Mariia Shalabaieva on Unsplash.com, charts from TradingView.com, Arcane Research