Bitcoin Spot Volume Stays Stable, But Binance’s Share Grows

Data shows the Bitcoin spot trading volume has remained stable in 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, the BTC trading volume has stayed steady at around $10 billion in the past week. The “daily trading volume” is an indicator that measures the total amount of Bitcoin being transacted on the Bitwise 10 exchanges on any given day.

The metric includes only the volumes from the Bitwise 10 exchanges because they are known to provide the most reliable data in the market. While they aren’t all the platforms there are in the sector, their trading volume trend can still provide a decent picture of the trend in the wider market.

When the value of the indicator is high, it means a large number of coins are being moved around on the spot market currently. Such a trend can be a sign that traders are active in the market.

On the other hand, low values suggest the Bitcoin spot market is observing low activity right now. This kind of trend can imply that there isn’t much interest in the asset among investors at the moment.

Now, here is a chart that shows the trend in the 7-day average Bitcoin daily trading volume 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 displayed in the above graph, the 7-day average Bitcoin daily trading volume has been at elevated values of about $10 billion during the past week. However, as is apparent, a vast 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 just $390 million in the last seven days, which is the lowest the metric has been since 7 January 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 like Coinbase, Kraken, and Bitstamp have taken a hit in this period.

Generally, when the price of Bitcoin is trading sideways, the trading volume tends to fall as investors usually find consolidating markets boring and so they don’t tend to make too many moves. Since BTC is showing stale movement currently, it’s not a surprise that volumes aren’t too high in most of the exchanges.

As for why Binance’s volumes are still so strong that the platform is rather gaining more dominance, the report explains, “rotation from BUSD to USDT via Binance’s BTC pair may explain parts of the elevated Binance volume in the past month, as both the BTCBUSD and BUSDUSDT pair have seen elevated volumes on the backdrop 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