Bitcoin market goes quiet: volumes at lowest level since 2019

The Bitcoin market has become remarkably quiet. Spot volumes, exchange inflows and volatility are all at historically low levels, while US government bonds are yielding more than the crypto carry trade for only the second time ever. That is the conclusion drawn by data firm Glassnode in its latest Week on Chain report, titled “Paid to Wait”.

Bitcoin is available at OKX and Bybit.

Spot volume falls to seven-year low

Daily spot volume on exchanges is currently around 60,000 Bitcoin per day, the lowest level since 2019. By comparison, during the 2021 bull run and the period that followed, these volumes were structurally much higher. Even when excluding Binance’s inflated figures from the zero-fee period in 2022 and 2023, the decline is still strikingly sharp.

That low activity is also reflected in the order book. Sell orders above the current price are sparse, while a solid layer of buy orders has been sitting below the market price since the beginning of June. This points to a market waiting for a trigger, but where no one dares to make the first move.

Crypto yields less than government bonds

One of the most striking observations from the report is that the crypto market has been yielding less than US two-year government bonds for 157 consecutive days. This is only the second time in recent history that this has persisted for so long. The previous comparable period lasted 160 days and coincided with the bottom of the 2022 cycle.

The annualised futures basis, a widely used measure of the return on the crypto carry trade, is currently structurally below the yield on short-term Treasuries. This makes it more attractive for institutional parties to simply wait in government bonds rather than actively take positions in the crypto market.

Heavily occupied price zone could determine movement

Glassnode’s analysis further shows that Bitcoin is currently sitting in what it describes as the heaviest accumulation zone ever measured. Some 2 million Bitcoin have been purchased in the price range between $62.000 and $68.000, largely by recent buyers. Above that lies a resistance zone between $83.000 and $86.000, with 1.2 million Bitcoin held by long-term holders waiting at that level.

This combination of low activity, declining volumes and a market stuck between two large accumulation zones paints a picture of a Bitcoin market that is, for now, in waiting mode. Whether that silence results in a breakout to the upside or the downside remains the big question at this point.