bitcoin (BTC)’s Massive Gains Have Not Attracted Crypto Day Traders

Data provided by Bitstamp shows that despite bitcoin‘s significant gains this year, retail trading volume on the exchange’s US platform has only grown from 33% to 35%, while global retail volume has only risen from 8% to 9%.

Reasons for the Decline

In conversations with Bloomberg, numerous professional traders have expressed their loss of interest in crypto trading, even after making huge profits in the past. Peter To, a professional stock trader, made $1 million trading bitcoin in previous bull runs but has not been enticed back into the market despite the 110% rise in the asset’s value. He mentioned that the market is not as volatile or driven as it used to be, reducing its appeal for traders like him who seek market inefficiencies.

Craig Murray, who claimed to have made over $200,000 in crypto, decided to leave the market after narrowly escaping from the collapse of FTX. The incident made him realize that the risk of staying in such a market was not worth it.

Declining Retail Traders

Another sign of declining interest from traders is the decrease in weekend trading activity. Fredrick Collins, CEO and founder of Velo Data, noted that weekends with half the trading volume are now common, whereas volume used to be relatively equal throughout the week.

Coinbase’s latest earnings figures also show a 12% drop in total transaction revenue between the second and third quarters of 2023, attributed to low market volatility. This decline is not limited to crypto, as retail investment in equities also dropped by 40% between 2021 and 2022, according to JP Morgan Chase and Co.

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