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Should we be worried about the spot trading volume surge on Binance ?
When spot trading volume surges, it could signal the beginning of an euphoric phase or even FOMO. These spikes often correlate with the crypto market cap reaching or approaching all-time highs. The recent surge in spot trading volume (60B) on Binance occurred on November 12, coinciding with the crypto market cap nearing its previous ATH. However, trading volume has since decreased by half meanwhile the total crypto market cap enters price discovery mode. This decline in spot trading activity may suggest that the market is taking a breather, with investors exercising caution. It also helps reduce volatility, thereby lowering the risk of intense selling pressure, as seen in March when spot trading volume exceeded $70 billion.