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Investing.com – The market’s wavering continues, with the cryptocurrency trending sideways around the $26,000 threshold for several days as trading volumes hit lows not seen in several years.
Bitcoin trading volume indeed hit its lowest level in nearly five years in August as investors continue to be reluctant to return to the market frankly.
Bitcoin volume close to 5-year low
An analysis of CryptoQuant data from spot exchanges and derivatives shows that the total volume of bitcoin held across all exchanges earlier this month fell to its lowest level since 2018 and struggled to rebound.
Specifically, bitcoin trading volume across all exchanges stood at 129,307 BTC as of 8/26, according to CryptoQuant, after falling to 112,317 BTC on 8/12, its lowest level since April. November 10, 2018.
“Trading volumes decline in bear markets as retail investors leave,” Julio Moreno, head of research at CryptoQuant, told CNBC.
He also recalled that “this happened in 2022 on most exchanges”, but estimated that “as we progress in a bull market, the volume of transactions could continue to increase.”
However, it must be admitted for the moment that the bullish catalysts for Bitcoin are scarce, with an uncertain economic outlook, and a recent return of bets on an even stricter monetary policy from the Fed.
We must also take into account the hostility of regulators, particularly in the United States, towards cryptocurrencies, a file that clearly puts a brake on the rise of the digital asset market in recent months.
Bitcoin to $100,000 next year thanks to halving, spot ETF, and digital gold status?
Even so, many remain optimistic about the future of Bitcoin, especially given the prospect of a key technical event expected next year. In a recent interview with Paul Barron, Vice President of Bitcoin mining firm Hut 8, Sue Ennis, for example, predicted that the price of Bitcoin will exceed $100,000 in the coming year thanks to the impact halving.
Remember that the halving is an event specific to the Bitcoin network that occurs approximately every 4 years, and which halves the reward for Bitcoin miners. However, as these are remunerated in “newly created” bitcoins, the halving corresponds to a reduction in the rate of growth of supply, which, also on demand, should have a mechanically upward impact on the price.
The scenario has also been confirmed several times in previous halvings. Ennis also touched on the potential bullishness of a bitcoin spot ETF in the US, which remains uncertain, although the filing of a request by BlackRock (NYSE:) a few months ago definitely increased the likelihood according to the most experts.
In this regard, she estimated that the chances of approval are “definitely better than 50%”. “The real reason for my opinion on this is that BlackRock threw its hat in the arena, BlackRock being powerful and the biggest asset manager in the world,” she said.
She added that “the power of BlackRock, the world’s largest asset manager, allows it to say it’s what it wants, and the clout it has had in the markets in past initiatives has was huge. So I think the fact that they are making this call is a real bullish signal.”
Finally, regarding the impact on the price of bitcoin, Ennis estimated that “we could see over the next cycle a cost of $100,000 per bitcoin, and that if BTC captures even 2 to 5% of the $13 trillion in institutional portfolios”.