The total trading volume on bitcoin exchanges shrunk from 12 to 6 million BTC overnight.
The price of the digital currency collapsed on Sunday evening from $753 to $713. In the early hours of Monday, bitcoin partly regained losses and by 06:22 GMT stabilised around $731.
The drastic fall of the price coincided with a reduction of trading volume on all BTC exchanges. According to Bitcoinity, it fell from 12 million bitcoins on 16 November to 6 million on 20 November. The contraction affected both Chinese and US-oriented exchanges.
The recent data from BTC-e reveals traders’ cautious optimism. According to the exchange’s online chat, they are buying the digital currency hoping for another price hike in the near future.
Still, even some experienced brokers are uneasy about the hike in bitcoin volatility. “this market behavior is called Quiet Insanity,” in words of user tarkus909.
The fall of bitcoin price to the current low follows the last week’s surge: on 16 November, the cryptocurrency exchange rate jumped $40 up to over $751.
Last time bitcoin traded close to this level in mid-June 2016 with the exchange rate at $764. Previously, bitcoin had reached such a rate only in January and February 2014, after which the cryptocurrency crashed down and could not return to this level for the next two years.
The uptrend was probably caused by the situation in China, where investors anticipate a further weakening of the national currency. Bitcoin enthusiasts and investors prefer to transfer part of their assets into the cryptocurrency. The secondary reason might have been the electoral success of Donald Trump.