Crypto Exchange Volume Tops $100B Amid Bitcoin ETF Buzz

The cryptocurrency market has hit unprecedented levels in daily trading volume on centralized crypto exchanges not seen since November 2021, marking a notable uptick in market activity boosted by Spot Bitcoin ETF hype. The exchange surged to a record-breaking $97.4 billion.

According to data from The Block’s Data Dashboard, the seven-day moving average for daily trading volume across multiple centralized exchanges peaked at $97.4 billion on March 6th. This rise follows a notable uptick from lows of around $24 billion seen in early February, indicating a revival in trading engagement.

Crypto Record-Breaking Activity

In the history of the daily exchange volume, such levels have only been attained and sustained for less than two months of crypto trading. The bulk of this heightened activity was witnessed during the bullish market conditions of 2021, notably when Bitcoin soared to its previous peak of $69,000.

This record coincidentally is being witnessed as Bitcoin momentarily surpassed the $69,000 mark after a prolonged 28-month period, before slumping in trading on March 5th.

Although there has been a swift increase in daily trading volume in recent days, the monthly trading volume has been consistently rising in the last few months. In December 2023, the monthly volume on exchanges exceeded the $1 trillion threshold for the first time since late 2022, indicating the sustained growth trend of the cryptocurrency market.

Binance Dominance and Bitcoin ETF Frenzy Drives Market

Binance emerged as the dominant player in this surge, capturing a significant portion of the market share with around 43% of trading activity occurring on the platform. Available data shows that others are UpBit, OKX, and Coinbase next in size  

An analytical look at the data reveals that the surge in trading volume coincides with the launch of nine new spot Bitcoin exchange-traded funds (ETFs) and the conversion of the Grayscale Bitcoin Trust into an ETF.

Sustained Growth and Future Outlook

These developments have spurred considerable investor interest, resulting in a net inflow of approximately 170,000 BTC, valued at $11.4 billion. With the total assets under management for all ETFs surpassing $50 billion and cumulative volumes poised to approach the $100 billion mark, the ETF frenzy has injected renewed momentum into the cryptocurrency market.

The increased focus on ETFs has driven Bitcoin’s price to historic peaks, briefly exceeding its previous all-time high of $69,000 earlier this week. Despite a subsequent decline in value, Bitcoin remains close to record levels, highlighting investors’ persistent bullish outlook amid the changing dynamics of the cryptocurrency market.