Bitcoin has long been a hallmark of the cryptocurrency markets, thriving on its 24/7 accessibility. Weekend trading, once a breeding ground for volatility, has become particularly important in the cryptocurrency landscape.
However, a recent report by Kaiko reveals a not so rosy picture – BTC Trading volumes declined at the end of the week. to historic lows, potentially signaling a new era dominated by institutional weekday warriors.
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Bitcoin trading activity takes a nap
Kaiko data It’s clear: Bitcoin trading activity has shrunk dramatically over the weekend, falling from a high of 28% in 2019 to just 16% in 2024. The dramatic drop coincides with the highly anticipated launch of bitcoin exchange-traded funds (ETFs) in the United States. These ETFs, which mirror the behavior of stocks, can only be traded during traditional market hours.
The influence of institutional investors, who tend to favour these regulated products, is clear. The report highlights an increase in Bitcoin Trading activity during the “index setting window” – the last hour of US stock market trading. This indicates that institutions are forming new trading patterns, prioritizing weekdays over weekends that were previously active.
Beyond the Weekends: A Multifaceted Market Shift
The decline in weekend activity isn’t just attributable to ETFs. The closure of crypto-friendly banks like Signature and Silicon Valley Bank in March 2023 is another contributing factor. These institutions provided a 24/7 infrastructure that enabled market makers to continuously place buy and sell orders. Their absence created a liquidity vacuum at the weekend, further dampening trading activity.
However, the changing landscape is not all doom and gloom. The report offers a ray of hope for investors looking for stability. A drop in volatility over the weekend could make Bitcoin a more predictable asset, which could attract a new wave of institutional interest. Additionally, the historical trend suggests that July could be a positive month for Bitcoin, with price increases observed in seven of the past 11 months.
Is there any concern on the horizon?
While the weekend trading scene may have been quiet, it looks like the coming weeks will be somewhat turbulent for the cryptocurrency market. Possible approval of Ethereum ETFs It could further boost institutional participation and potentially impact Bitcoin dominance.
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The way forward
Dwindling trading activity over the weekend signals a potential paradigm shift in the Bitcoin market. While the once-hectic weekends may become a relic of the past, the coming months promise to be eventful.
Now institutional investors are in the spotlight, shaping new trading patterns and potentially ushering in an era of greater stability. However, this month could still be volatile, keeping investors on the edge of their seats.
Featured image from Inc. Magazine, chart from TradingView