Daily exchange trading volumes have significantly declined from their post-election highs, now stabilizing around $35 billion, roughly the same level as before President Donald Trump’s victory.
Following the Nov. 5 election, daily trading volumes soared to $126 billion amid heightened market excitement and speculative activity. However, volumes have since dropped by roughly 70%, returning the market to its pre-election baseline in a short timeframe. Recent tariff announcements targeting major U.S. trading partners have added uncertainty, dampening trading enthusiasm across both traditional and crypto markets.
Trading volumes have historically maintained a strong correlation with overall market capitalization, following similar trajectories in recent months. The total cryptocurrency market cap peaked at approximately $3.9 trillion before retreating to current levels of around $2.9 trillion, marking a 25% decline.
Signs of accumulation before major market moves?
This contraction in trading volume could signal upcoming significant market movements. Historically, prolonged periods of declining volume have often preceded large price swings, as reduced liquidity amplifies price impacts when major players start repositioning their portfolios.
Investors appear to be awaiting greater clarity on the Trump administration’s stance on cryptocurrency regulation before engaging in more active trading. The combination of declining trading activity with a relatively stable market cap suggests that an accumulation phase may be underway, with participants focusing more on strategic positioning than short-term trades.
Upcoming regulatory announcements, particularly those concerning cryptocurrency classification and oversight frameworks, could act as key catalysts to reignite market activity.