Chart of 2-year trading volumes. Source: Bitcoinity.org Bitcoin exchange trading volumes have hit an all-time high even as the digital currency’s price closes in on a 52-week peak.
According to Bitcoinity , the busiest day for exchanges to date was recorded on 26th November, when some 2.86 million worth of bitcoin was traded across all exchanges indexed by the data provider.
Trading volumes have been setting records in recent weeks, with the previous peak occurring just four weeks ago, on 30th October, when 2.49 million bitcoins were traded.
As trading volumes have risen, so has the price. The price gained $25 or 7.6% in a days’ trading, even as volume surged to its 26th November peak, according to the CoinDesk Bitcoin Price Index . Similar volume growth accompanied price rallies at the end of October and early November. Greater mainstream adoption?
Nov 30 coindesk-bpi-chart Although the surge in volume took place on the eve of the major shopping event Black Friday – holding out the possibility of a link between greater consumer adoption of bitcoin and its price and volume spike – market-watchers CoinDesk spoke to believe the run-up has been driven by traders and exchanges themselves, not commercial activity.
"Only a small percentage of exchange volume will be due to genuine bitcoin use or adoption," said Alistair Milne, who the runs Monaco-based Altana Digital Currency Fund.
As more exchanges introduce leveraged trading, the possibility of outsized movements in the bitcoin price grows. As borrowed funds come due, they can cause the price to jump or plunge while the borrowed sums are settled, Milne added.
"But bitcoin traders, especially those using leverage, artificially amplify short term supply or demand in both directions … when leveraged contracts come to maturity or settlement, they can cause large movements in the spot price," he said.One exchange that […]
