Bitcoin’s Trading Volume Surges Following US Election

Disclosure: The author of this story owns shares in MicroStrategy (MSTR)

Since Donald Trump won the U.S. election on November 5, 2020, bitcoin (BTC) has soared from $67,000 to around $100,000. This has coincided with a huge rise in bitcoin’s total trade volume, which has now surpassed $100 billion.

Futures Trading Volume Hits All-Time High

According to Checkonchain data, bitcoin futures trading volume hit an all-time high of around $120 billion on November 17, almost doubling since the U.S. election. However, since then, futures trade volume has plateaued and steadied around $100 billion.

The same can be seen with spot trade volume, which has also doubled from around $6 billion to $12 billion. While the spot listed U.S. exchange-traded funds (ETF) trade volume has also picked up, reaching $4 billion a day.

Long-Term Holders Sell, Short-Term Holders Buy

Bitcoin remains in a key trading range of $100,000, going above and below this key psychological area on multiple occasions. A lot of this has to do with the enormous sell pressure coming from long-term holders (LTHs) or investors who have held bitcoin for longer than 155 days.

Since September, LTHs have sold 843,113 BTC. In the same period, short-term holders (STHs), those who have held bitcoin for less than 155 days, have accumulated 1,081,633 BTC. This works out to around 9,960 BTC sold by LTHs and STHs accumulating 12,432 BTC per day.

Comparison with Other Big Players

To show the difference of trading volumes between long and short-term holders, we compare them to other big players in the industry, such as the self-described bitcoin development company MicroStrategy (MSTR). MicroStrategy holds 423,650 bitcoin or just over 2% of the total supply. In addition, U.S. ETFs now hold over 1 million bitcoin.

Since September, MicroStrategy has accumulated 197,250 BTC, which works out to roughly 2,168 BTC per day. While, the U.S. ETFs have accumulated approximately 205,000 BTC, which works out to 2,253 BTC per day. The U.S. ETF BTC balance has grown from 916,000 BTC to 1.12 million BTC.

Conclusion

In order for bitcoin to conclusively break higher of $100,000, we will need to see LTHs dial down on offloading their tokens or have bigger cohorts enter the space and pick up the buys.

FAQs

Q: What is the current trading volume of bitcoin?

A: The current trading volume of bitcoin is around $100 billion.

Q: What is the difference between long-term holders and short-term holders?

A: Long-term holders (LTHs) are investors who have held bitcoin for longer than 155 days, while short-term holders (STHs) are those who have held bitcoin for less than 155 days.

Q: What is the impact of LTHs selling on the market?

A: The sale of bitcoin by LTHs can put downward pressure on the market, causing the price to drop.

Q: What is the role of MicroStrategy in the bitcoin market?

A: MicroStrategy is a self-described bitcoin development company that holds 423,650 bitcoin, or just over 2% of the total supply.

Q: How do U.S. ETFs fit into the equation?

A: U.S. ETFs now hold over 1 million bitcoin, making them a significant player in the market.