Average Bitcoin Trading Volumes Rise 2.7x to $3 Billion in Early November
A Nov 10 report from Arcane Research shows that Bitcoin’s upward momentum is firm as average trading volumes across spot and derivative exchanges continue to rise.
Bitcoin Price Bull Ran
The Bitcoin price is now steady above $15,400 according to coin trackers. Adding an impressive 12 and 34 percent in the last week and month, respectively, buyers are firmly in control.
Behind the upswing in momentum is the sharp spike in participation levels. For instance, in the first week of November, the seven-day moving average daily trading volume rose 2.7X to $3 billion, the highest level in 2020.
Buoying Bitcoin upswing is the participation of institutions. Parallel data from Skew reveals that the number of Open Interest (OI) from the CME Bitcoin Futures is near Aug 2020 highs of around $950 million.
OI measures the number of open contracts, a number that more than doubled in the last week of trading. The higher the OI, the more confident traders are on Bitcoin prices. At the same time, the number of whale traders—those with trading more than five CME contracts or over 25 BTC, has more than doubled in 2020, rising from 40 to 99 in early November 2020.
Notably, the more than doubling of the number of open contracts is a bullish indication for the Bitcoin price as it shows institutions and high net-worth investors forecast better prices and would rather keep their positions unsettled than exit and take profits.
The Disarray of the US Presidential Election Pumping Price
Bitcoin, pumped by uncertainty around the US Presidential Election, is one of the top-performing digital assets. Combined with its dual-function, acting as a store of value and a medium of exchange, the coin is now serving as a conduit of capital flowing from the stock markets.
If there is a protracted legal battle between the incumbent and Joe Biden, the stock market will likely tumble while safe-haven assets like Bitcoin and gold will soar as they thrive during times of political turbulence and economic crisis.
The Bitcoin’s store of value characteristic has been a drawer in recent times. As billionaire hedge fund managers including Paul Tudor Jones and Stanley Druckenmiller get behind Bitcoin, praising its properties, more investors are convinced and allocate more capital.
Earlier, as BTCManager highlighted, institutional-grade investors continue to pump money into Bitcoin according to a JP Morgan report.