While the price of bitcoin (BTC) seems to be taking a nap, the trading volume on crypto exchanges also reflects an uncertainty. Currently, the 7-day moving average of bitcoin spot trading volume is dangling around $13 billion, reports The Block. By comparison, this metric hit $46 billion earlier this year in March.
Bitcoin volume in free fall
Bitcoin traders remain very cautious despite the recent improvement in sentiment. Crypto exchanges have fallen a bit out of favor since all the legislative frenzy. Also GoogleTrends shows that interest in bitcoin has been on a downward trend since the 2021 bull market and is getting slightly lower
Yet the bitcoin price recently rose by more than 20 percent when it was announced that Blackrock, the largest asset manager, had applied for a bitcoin ETF, or exchange fund. This was also accompanied by a small increase in volume, but that has since declined. Since then, the bitcoin price has also been stuck in the same range just above $30,000.
Institutions steal the show
Although the spot volume continues to decrease, The Block does report a significant increase in the volume of derivatives and futures for bitcoin, the trading instruments of professional traders and institutions. So is the open interests (IO), the total outstanding derivatives for bitcoin, rose sharply in June. The Block reports that the IO on CME bitcoin futures hit $47 billion in June and is on track to break this amount by July.
The fact that bitcoin is gradually becoming popular again among large investors is also evident from the recent influx to bitcoin funds and other investment products. So reports Coin Shares that no less than $470 million went to bitcoin products in the past three weeks. This follows nine weeks of outflow from these types of funds. ProShares’ bitcoin fund also saw strong inflows last week, and even the strongest in a year.