Bitcoin trading volume on weekends has been decreasing this year, according to crypto research firm Kaiko. Historically, around 25% of Bitcoin trading volume occurred on weekends between 2018 and 2021. However, this figure has dropped to 13% in 2024. Kaiko suggests that the decline in weekend trading volume can be attributed to increased institutional participation and market infrastructure challenges. The 24/7 nature of crypto trading creates a mismatch between the operating hours of traditional financial institutions and the needs of large crypto traders and market makers. Kaiko also points out that several crypto-friendly banks in the US have closed down, further exacerbating the liquidity challenge. The decline in weekend trading volume is observed in both US and offshore exchanges, with offshore exchanges like Binance, HTX, OKX, Bybit, and Upbit experiencing slightly higher weekend trading volume compared to US exchanges like Coinbase, Kraken, and Bitstamp. Kaiko notes that liquidity conditions are poorer on Coinbase during weekends compared to Binance, with trading costs increasing on Coinbase since Q2 2023. On the other hand, Binance has seen a decrease in trading costs during the same period. The research firm also highlights that Bitcoin liquidity has improved since the launch of spot Bitcoin exchange-traded funds (ETFs) in the US. However, there have been few transfers between ETF issuers and exchanges over the weekends. Kaiko predicts that this gap may widen as ETF issuers continue to increase their Bitcoin holdings.
TradFi institutions and spot ETFs cause a decline in Bitcoin trading over the weekend