Bitcoin reclaims $120K amid rise in exchange spot volumes
|- Bitcoin reclaimed $120,000 on Tuesday as it draws closer to its all-time high.
- BTC's spot activity on exchanges spiked since hitting its all-time high, with Binance volumes leading the rise.
- Bitcoin's open interest also broke above its upper range, signaling increased market participation.
Bitcoin (BTC) briefly hit the $120,000 mark on Tuesday as rising spot trading volumes on exchanges and a spike in open interest (OI) signal further upside.
Bitcoin's spot and futures volumes show possibility for further upside
Bitcoin's spot trading volumes on centralized exchanges surged following its all-time high rally last week, according to a report from CryptoQuant on Tuesday.
Crypto exchange Binance recorded the largest increase in spot volume, jumping from $3.1 billion to $8.8 billion during the rally. Likewise, the combined volumes on other major platforms, including Coinbase, Crypto.com, Bybit, and OKX, climbed from $5 billion to $12.7 billion over the same period.
Binance's large spot volume suggests that retail traders played a major role in driving Bitcoin's rally, particularly as volumes on other exchanges declined after BTC peaked near $123,000.
"Binance's trading volume remained elevated in the aftermath of the fresh all-time high, as volumes on other exchanges decreased," wrote Julio Moreno, Head of Research.
The rising spot volume was supported by a 7.3% spike in Bitcoin OI to $45.4 billion, rising above its high statistical band of $41.5 billion, according to on-chain analytics firm Glassnode. Funding payments also surged alongside futures OI, rising 59.5% to $4.4 million, well above the $2 million high band, suggesting that traders are paying a premium to maintain bullish bets.
The surge in spot and futures volumes suggests a large influx of capital into the market, indicating further upside potential as investors maintain bullish sentiment.
This is evident in Bitcoin's Realized Cap Change metric, which climbed from 4.5% to 5.8% over the week. The metric has now breached its high statistical band, indicating rising capital inflows and active buying at higher prices.
Historically, such levels have often preceded periods of profit-taking, particularly when broader market momentum begins to wane. This is evident in Bitcoin's pullback towards $115,000 over the past few days, suggesting that holders began to book profits.
However, BTC rallied near its all-time high on Tuesday, briefly hitting $120,000, indicating renewed interest among investors.
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