Factors Behind Reduced Weekend Trading

Kaiko, a cryptocurrency analytics business, produced a research showing that, for 2024, weekend BTC trading accounted at 16%; in 2019, on the other hand, it was 28%. The introduction of spot Bitcoin ETFs is among the factors causing this drop. ETF trading is limited to stock market hours throughout the week whereas crypto marketplaces run 24/7 worldwide. Since these products were released in Q4 2023, Kaiko analysts saw an upsurge in Bitcoin trading during the final hour of market trading, also known as the benchmark fixing window.

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“To reflect the benchmark price as closely as possible, the buying and selling of Bitcoin for creations and redemptions must happen during the fixing window [between 3 and 4 pm New York time]” the paper says. Though just on weekdays, this has made the fixing window the second most used period for Bitcoin trading. Nevertheless, starting from 2021, weekend trade has been gradually decreasing and the present level is the minimum in its history. Certainly, the trading that takes place in the benchmark period within the weekdays constitutes 6,6% of overall trading, whereas the same trading during the weekends reaches only 4,1%.

Impact of Bank Closures and Market Dynamics

Additionally responsible for the declining weekend trading activity is the closing of additional crypto-friendly institutions such Silicon Valley Bank and Signature in March 2023. These banks have 24/7 networks that allowed for notable demands for cryptocurrency in purchases and sales. Market creators have become less likely to provide liquidity in a low-volume situation since their closures. A Bloomberg analysis claims that this has greatly affected weekend trade activity.

Bitcoin’s price has stayed the same in the near term as investors attentively track inflation figures in expectation of a Federal Reserve interest rate reduction.

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