Ethereum
Bloomberg reveals reasons for falling prices of Bitcoin, ETH, SOL, XRP and SHIB
Crypto trading volumes on major crypto exchanges fell massively in April. Trading volumes fell for the first time in seven months after the price of Bitcoin fell from an all-time high of $73,800, Bloomberg reported on Friday.
The situation persists in May as spot and derivatives trading volumes decline, driving Bitcoin and altcoins prices are expected to fall further. Bitcoin price fell to $60,400 as comments from Fed officials and new data on inflation forecasts pushed back against rate cuts.
Trading volumes fall on macroeconomic concerns
Spot trading volume on major centralized exchanges such as Coinbase, Binance and KuCoin fell 32.6% to $2 trillion in April, data from CCData. Additionally, derivatives trading volumes also fell 26.1% to $4.57 trillion for the first time in seven months.
Trading volumes soared earlier this year in response to the approval and listing of Bitcoin spot exchange-traded funds (ETFs) in the United States in January. April 19 Bitcoin halved It also did not lead to a sudden increase in the price of BTC or a recovery in the crypto market, and the price fell below $60,000.
“Consistent with trends observed over the past two cycles, trading activity on centralized exchanges generally slows down in the two months following the Bitcoin halving event,” said Jacob Josephresearch analyst at CCData.
Additionally, ongoing fears of inflation and stagflation facing the US Federal Reserve have weakened market confidence. Also, warmer CPI Inflation data, escalating tensions in the Middle East and potential bank run concerns have caused the market to sow uncertainty and fear. The reversal in sentiment caused net negative flows from spot Bitcoin ETFs.
Binance and CME Group revealed low trading volumes
The largest cryptocurrency exchange in the world Binance saw its spot market share fall 4% to 33.8% for the first time since September 2023 as trading volumes declined significantly.
Additionally, CME Group, the largest Bitcoin derivatives exchange, saw cryptocurrency trading volume decline by almost 20% to $124 billion.
“Despite this, while trading activity on centralized exchanges has slowed from its peak in March, it remains at a high level compared to volumes recorded in other months,” Joseph said.
Read also: Here’s why the price of Bitcoin is falling sharply
BTC price awaits another breakout
CoinGape accurately predicted the recent crypto market recovery as Bitcoin chart patterns confirmed a breakout above the trendline. BTC Price rebounded from $60,630 to $62,585 in a matter of hours on Thursday after a 3-day descending trendline was broken in a shorter time frame. The price reached a high of $63,446 today, along with other altcoins such as ETH, SOL, XRPDOGE and SHIB are also rebounding.
However, fears of a pullback remain due to the expiration of options and economic data to be released this week and next week.
A break above the descending channel since mid-March would be bullish for BTC price to reach $100,000. This will be confirmation of Bitcoin’s price rise after the halving, triggering a broader crypto market rally.
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