Crypto Market Boredom: Bitcoin & Altcoins See Volume Crash

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The data recorded on the blockchain indicates that cryptocurrency traders are taking a break or delaying their trades, as there has been a significant drop in trading activity for Bitcoin and other digital assets.

Bitcoin & Altcoins Have Seen A Trading Volume Crash Recently

Based on information from the chain analysis company Santiment, there’s been a decrease in trading activity within the cryptocurrency market over the last seven days.

In simpler terms, “trading volume” represents a measure that tallies the overall quantity of a specific asset being bought and sold across significant trading platforms. An increase in this value suggests that investors are engaging in more transactions involving the digital currency. This pattern typically indicates growing interest in the asset.

Alternatively, when the indicator shows a decrease, it implies that traders might be shifting their focus, possibly engaging in less trading due to reduced activity levels.

Here’s a visual representation displaying the progression of the total Bitcoin trading volume across four distinct categories within the digital currency market.

This diagram illustrates how the overall Bitcoin trading volume has evolved over time, divided into four unique parts of the digital money market.

The graph you see presents the top six categories within the cryptocurrency market: Memecoins Leaders, AI & Big Data Leaders, First-Layer Leaders, and Second-Layer Leaders.

Layer 1″ assets, in simpler terms, are cryptocurrencies that operate directly on their own blockchain network, handling their own security without relying on another ecosystem as a foundation. Notable examples of such coins include Bitcoin and Ethereum. On the other hand, coins not running on primary networks, like Polygon (MATIC) and Arbitrum (ARB), are referred to as “Layer 2” assets.

It’s clear from the graph that all the top six coins in each category have experienced a significant drop in their trading activity over a recent period. Similarly, meme-inspired tokens and those focusing on artificial intelligence technologies have exhibited a similar downtrend.

During the period from late November to mid-December, trading activity was brisk throughout the market, with many investors taking advantage of the enthusiasm surrounding the Bitcoin price surge. However, it seems that the more recent bearish trend has taken a toll on investor confidence.

Following the most recent dip in the indicator, market trading activity has dropped to its lowest point since November 3rd, just a day before the U.S. presidential elections.

Typically, the market becomes more unpredictable when a significant number of traders engage in trading, as their transactions drive price fluctuations. Given the decrease in trading activity observed throughout the cryptocurrency market lately, there’s a chance we may experience a period of relative stability for Bitcoin and other coins in the near future.

In simpler terms, when trading activity decreases significantly, it could indicate a high level of fear, uncertainty, and doubt (FUD) in the market. Historically, such conditions have often been associated with market bottoms.

BTC Price

At the time of writing, Bitcoin is trading at around $90,700, down almost 8% in the last week.

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2025-01-14 04:11