Crypto Derivatives Market Trading Volume Surged from $38.3B on Nov 21 to $66.9B on Nov 27, 2020 after Bitcoin Price Crash: Report

The TokenInsight team notes that once again (unsurprisingly), we all received a “big gift” from the digital asset market for Thanksgiving with Bitcoin (BTC) crashing – which came right after it surged past the $19,000 mark for the first time in around three years. The TokenInsight market report states that the cryptocurrency market has become well-known for its unpredictable nature, high volatility levels, and potential cases of market manipulation.

The report from TokenInsight pointed out that BTC may have dropped by $3,000, but its price has increased significantly this year.

The report noted:

“Because of the sharp [BTC] price drop, the trading volume of the derivatives market has increased from $38.3 billion on 21st Nov. to $66.9 billion on 27th Nov. The price drop has also caused the massive liquidation of traders. Open interest dropped from $6.3 billion on 25th Nov. to $4.9 billion on 26th Nov.”

The report added that crypto and blockchain industry participants have different opinions about why the Bitcoin price fell sharply. It also mentioned this is “the second time of deleveraging this year after the Black Thursday in March 2020.” According to TokenInsight, the markets might have been affected after the statement from Coinbase that it would suspend all margin trading on the trading platform after reviewing the recent guidance from the US Commodity Futures Trading Commission.

The report further noted that on November 24, 2020, the threshold to launch the Ethereum 2.0 mainnet was reached, with almost 80% of the required 524,000 ETH having been committed (staked) into the ETH2 deposit contract. As confirmed in other reports, the launch of Ethereum 2.0 is officially set for December 1, 2020.

The TokenInsight team pointed out that the Ethereum price surged to around $620 after the threshold was reached, which boosted market emotions to a “crazy” level. The total ETH trading volume on that day had surpassed Bitcoin’s (BTC) trading volume by around 2.5x. The ETH-USDT pairs’ volume reached almost $3 billion in just one day, the report confirmed.

But the Ethereum price fell sharply and its down almost 25% from its recent high above $600. The digital asset’s price has been fluctuating quite rapidly. According to the report, Ethereum 2.0’s voting may have “a direct relation to the shock.”

There was also substantial perpetual contracts trading volume when Ethereum 2.0’s launch had been confirmed, the report revealed. When compared with trading activity from last week, the ETH perpetual contract volumes surged 14%, hitting $83 billion for the week and reaching a single day high of $18.3 billion.

During this past week, the price of XRP reached a two-year high.

XRP notably surged 50% in only 2 days with around 2.3 billion XRP (appr. $1 billion) flowing into the digital asset exchanges since November 21, 2020, the report noted. This is reportedly 3x last year’s average inflows, according to data from Chainalysis.

But the price of XRP surged to as high as $0.79 on November 24, only to crash by as much as 30%, to $0.51 almost immediately after, the report noted.

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