Bitcoin exhibits increased trading activity during US hours

Since November 2022, bitcoin posts more significant gains during US hours compared to the Asian and European trading sessions, new research finds

article-image

rzoze19/Shutterstock, modified by Blockworks

share

The world’s largest crypto is showing increased strength and trading activity during US market hours, according to recent data compiled by two industry firms.

In the last week, bitcoin (BTC) has witnessed “staircase-like gains,” forming a pattern of rising prices during US market hours. That tends to stabilize by day’s end, according to research from digital assets brokerage K33.

“US market hours are now the strongest market hours for BTC since the November bottom, after recovering from a challenging period between mid-Feb to mid-June,” K33 said in a research note last week.

BTC has since climbed 62% year-to-date, 13% over the last 30 days and is up 1.5% on the week to $30,700. BTC remains fairly muted on the day — up 0.6%, data from Blockworks Research shows.

The asset’s behavior during US hours contrasts with the relatively stable trading activity during the Asian and European sessions. Since last November, bitcoin has seen more significant gains of 30% during US hours compared to Asia (21%) and Europe (17%).

The majority of the asset’s gains in recent weeks appear to be backed by renewed interest following Blackrock’s spot bitcoin ETF application last month, according to digital asset Australian trading firm Zerocap. 

A flurry of spot ETF applications from major US-based financial services firms including WisdomTree, Valkyrie and Fidelity Investments have also helped drive optimism as they vie to become the first to offer such a product.

Net exchange outflows and equity correlation

As such, the accumulation of bitcoin by US traders can also be traced to consistent net outflows (more BTC leaving than entering) from US-based exchanges such as Coinbase, Kraken, and Gemini, Glassnode wrote in a report last week.

“After the LUNA debacle and for much of 2023, off-shore exchanges have seen net inflows, whilst on-shore exchanges are seeing net outflows, as US-based investors accumulate or stay neutral,” Glassnode said.

Bitcoin’s correlation with the US asset indices, including Nasdaq and the S&P 500, has also turned negative for the first time since January 2021, K33 said. 

This suggests US traders are investing in BTC for unique reasons specific to the crypto rather than following broader market trends.

Macro factors

Macroeconomic fundamentals leading up to the end of the quarter have been mixed, William Fong, Zerocap’s Treasurer told Blockworks. 

“There has been a repricing of short-term bond yields, reflecting expectations of higher interest rates and a potentially longer hiking cycle for the US dollar,” Fong said.

To date, CME Group’s FedWatch Tool indicates market participants have begun pricing in an 85% chance of a 25-point basis hike at the conclusion of the FOMC’s meeting on July 26.

A stronger US dollar relative to other currencies including the flailing Japanese Yen is offsetting part of the momentum in digital assets, Fong added. The dollar index (DXY) has rallied about 1.2% over the past 7 days.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research report - cover graphics (1).jpg

Research

In this report, we dive into crypto private market data to gather insights on where the future of the industry is headed. Despite a notable downturn in private raises, capital continues to infuse promising projects that aim to transform payments, banking, consumer experiences, community, and more, with 2023 being the fourth-largest year for crypto venture capital.

article-image

BUZZ holds shares of Coinbase, Robinhood and MicroStrategy

article-image

Opinion: Even though I didn’t pay for my “Diamond Hands” burger with BTC, don’t let that fool you into thinking that crypto’s development is futile

article-image

The results mark “a major positive inflection point,” one analyst says, as the exchange carries net income momentum into a crypto rally

article-image

While the slate of 10 US spot bitcoin funds have tallied $4.6 billion of net inflows thus far, half of the field is lagging the leaders

article-image

Trading volumes totalled $154 billion in Q4, including $125 billion in institutional volume

article-image

DeFi on Bitcoin is all the rage right now and Stacks is positioned to benefit