Declining Bitcoin trading over the weekend attributed to the influence of traditional financial institutions and the introduction of spot ETFs.

Bitcoin trading volume on weekends has been declining as institutional investors have become more active in the market, leading to decreased liquidity, according to crypto research firm Kaiko. From 2018 to 2021, around 25% of Bitcoin trading volume occurred over the weekend, but this figure has dropped to 13% in 2024, as reported by Kaiko on February 26. The decline in weekend liquidity can be attributed to increased participation from institutional investors and the underdeveloped market infrastructure. Managing liquidity on weekends has been a challenge for exchanges due to the mismatch between traditional financial institutions’ operating hours and the needs of crypto traders and market makers. This issue became apparent when several crypto-friendly banks in the United States closed down. Kaiko found that the decrease in weekend trading volume was observed both in the US and offshore exchanges. However, offshore exchanges like Binance, HTX, OKX, Bybit, and Upbit still had slightly higher weekend trading volume compared to US exchanges like Coinbase, Kraken, and Bitstamp. Kaiko also noted that liquidity conditions on Coinbase were poorer during weekends compared to Binance, with trading costs increasing on Coinbase since the second quarter of last year. On the other hand, trading costs on Binance decreased during the same period. Kaiko mentioned that Bitcoin liquidity has improved significantly 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 concluded that this gap may widen as ETF issuers continue to increase their Bitcoin holdings.