Hidden Weakness? Why Bitcoin’s Low Trading Volume Is a Major Warning Sign

• A major divergence has appeared between Bitcoin’s rising price and its declining monthly trading volume
• The volume that supported previous all-time highs was approximately three times higher than today’s levels
• Analysts warn this thin liquidity could lead to a sharp downturn if large holders begin to sell

Despite Bitcoin trading near record highs, a worrying on-chain signal is flashing a warning sign for the market. A multi-year decline in monthly trading volume has created a significant divergence with Bitcoin’s rising price, leading some analysts to caution that the current market is built on a fragile foundation of thin liquidity.

This analysis suggests that recent price gains, including the push beyond $100,000 in 2025, are less supported by broad market participation than in previous cycles, which could pose a risk if selling pressure increases.

Shift in Bitcoin’s Trading Volume

Between 2013 and 2017, Bitcoin saw strong institutional buying activity, as reflected in heightened monthly trading volumes. This period of strong liquidity served as solid market support, enabling Bitcoin to build a foundation for its long-term price appreciation. Volume d…

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