Bitcoin Transaction Volume At It’s Lowest Since 2011

As you can clearly see from the chart, Bitcoin transactions have declined rather dramatically. This is perhaps due to a number of factors that have compounded of late. One factor is that the price of coin has not been strong lately and people are always reluctant to sell as it bottoms out. Another is that many buyers of Bitcoin have done so as an investment and plan on holding it for some time in the hope that it rises over time. Lastly potential investors are waiting to see if price will rise before buying.

One thing to consider (see story below) is that supply will soon start to dwindle and so this may aid an upturn in prices and start trading up again…

The Bitcoin Transaction Volume is Dropping.

Bitcoin transaction volume is dropping. Yesterday the transaction volume dropped to the lowest since 2011. Only 69,152 BTC were traded. What does it mean? Looking at the data, taken from Blockchain, we can see a clear decline in Bitcoin volume since November/December of 2013, when the Bitcoin volume was at 345,628 BTC with a peak in the middle of March with 441,337 BTC.

Looking at the same volume chart, but this time showing volume in USD, the transaction volume yesterday was at just over $30 Million. We must be aware of the drop in Bitcoin price and how this affects the transaction chart, but that being said; both charts exhibit the same trend – Bitcoin volume is now in decline.

Bitcoin value has fallen since the last quarter of 2013 and showed a dramatic increase up to this point. There are still traders, active in the market, holding bitcoins. More bitcoins are also entering the market from mining. Holding bitcoins over a longer term will decrease trade volumes and act to drive down the price as an effect of inter-exchange arbitrage, commissions and apparent lack of interest. This in turn may well force some traders, currently committed to Bitcoin, to withdraw from the market. This will certainly push an already depressed price further down.

Perhaps, Bitcoin advocates are viewing the current situation as an opportunity to hold and await a future opportunity to acquire. The holding of Bitcoins could actually be a sign of confidence. There have been 12.7 Million bitcoins mined, contrasting this to the transaction volume it shows that the vast majority are choosing to hold their bitcoins. Via cryptocoinsnews.com