Bitcoin frenzy? Coinbase surpassing $9 billion in daily volume shows big demand


The demand for Bitcoin is increasing as the rising volatility shows. Coinbase, the largest cryptocurrency exchange in the U.S., recorded $9 billion in daily volume on Jan. 11.

Yesterday, Coinbase, Kraken, and several other exchanges and data providers saw technical difficulties amid record-high trading volume.

The explosive increase in the trading volume of Bitcoin led to extreme volatility, causing BTC to drop to around $30,500.

Coinbase recording $9 billion in volume on a single day is noteworthy because it is equivalent to the total volume for Q1 2020.

The price of Bitcoin. Source: BTCUSD on TradingView.com

There is big demand for Bitcoin at $30ks, what’s next?

The price of Bitcoin briefly dropped below $33,000 yet again on Jan. 12, demonstrating weakening momentum after its initial recovery to $37,000.

Traders remain divided on the market sentiment around Bitcoin. The uncertainty around the short-term price cycle of Bitcoin might be the primary driver of the volatility and high exchange volume.

A pseudonymous trader known as “Salsa Tekila” said that BTC could easily drop to the $31,000 to $32,000 range once again. He said:

“I think we can easily dive back down to $31K-$32K. I wouldn’t bet on it, but I’d consider buying depending on the context. So, not chasing current prices without another dive, setting alert below 33k and above 36k to pay attention, in between I don’t care. Good luck, don’t chase.”

Based on the high volatility around Bitcoin and the high daily volume of Coinbase, cryptocurrency researcher Larry Cermak said he expects Coinbase to reach a valuation of around $100 billion. He wrote:

“You really can’t ask for much more than the growth that Coinbase is experiencing right before the IPO. At this point, I am expecting the stock to trade at more than $100 billion this year. The momentum is there and the mania will happen IMO”

Will this trend get sustained?

At least in the foreseeable future, major cryptocurrency exchanges are expected to see a massive trading volume.

After Bitcoin surpassed $40,000, it has been demonstrating 10% to 20% price swings on a daily basis.

On Jan. 11, as an example, Binance recorded an $8.5 billion daily trading volume for the Bitcoin-to-USDT (Tether) trading pair alone. This is close to Coinbase’s daily trading volume on the same day.

Considering that Bitcoin is moving back and forth between the $31,000 support area and the $36,000 resistance area, the high level of volatility would likely continue.

Below $30,000 would likely indicate the start of a short-term bearish trend. Consolidation under $30,000 could cause the volatility to drop and the daily trading volume of exchanges to slow down in tandem.

However, until the bullish market structure invalidation occurs, the Bitcoin market is expected to see extreme volatility in the foreseeable future.

Bitcoin, currently ranked #1 by market cap, is up 4.54% over the past 24 hours. BTC has a market cap of $640.68B with a 24 hour volume of $89.5B.

Bitcoin Price Chart

BTCUSD Chart by TradingView

Like what you see? Subscribe for daily updates.





Source link

Latest articles

Jack Dorsey’s Square has ‘no plans’ to purchase more Bitcoin ‘at this point’

Digital payments company Square, led by Twitter CEO Jack Dorsey, decided to hit the brakes—at least for the time being—on Bitcoin...

Bitfinex hacker will need 114 years to launder $7 billion worth of stolen Bitcoin

Only 4% of nearly 120,000 Bitcoin (around $7 billion today) stolen by a hacker from crypto exchange Bitfinex in 2016 have...

This firm turned an old power plant into Bitcoin farm—and mined $60 million in a year

Over the past few years, private equity firm Atlas Holdings has created arguably the most ambitious and self-sufficient Bitcoin mining facility...

Mark Cuban reaffirms Bitcoin plans after Tesla snub sparks concerns

Billionaire ‘Shark Tank’ star Mark Cuban said today that Dallas Mavericks, the Cuban-owned NBA basketball team, will continue to accept Bitcoin...

Related articles

Leave a reply

Please enter your comment!
Please enter your name here