Crypto Spot Trading Volume Halves in Three Months: Daily Crypto Analysis

VADODARA, February 3, 2026 — Cryptocurrency spot trading volume has collapsed by 50% over the past three months, according to data reported by Cointelegraph. This daily crypto analysis reveals a stark liquidity crisis, with Binance's Bitcoin trading volume plummeting from $200 billion in October 2025 to $104 billion in January 2026. Market structure suggests this is not a typical correction but a systemic withdrawal of capital, exacerbated by stablecoin outflows and a forced liquidation event on October 10, 2025.

Investigation: The Liquidity Drain Event

Cointelegraph's report identifies a precise timeline for the volume collapse. Binance, the largest exchange by volume, saw its BTC spot trading volume drop $96 billion in three months. The report attributes this decline to a "large-scale forced liquidation event" on October 10, 2025. This event triggered a cascade of selling, creating a massive Fair Value Gap (FVG) on price charts that remains unfilled. Consequently, liquidity maps from platforms like Glassnode show exchange reserves hitting multi-year lows. The narrative of a single event causing this sustained drop, however, warrants skepticism. On-chain data indicates stablecoin market capitalization has been contracting for months, suggesting a broader capital exodus predating the October liquidation.

Market Context & Historical Precedent

Historically, sharp declines in spot volume precede heightened volatility and trend reversals. The 2021 bull market peak saw similar volume contractions before the subsequent bear market. In contrast, the current volume halving coincides with a Crypto Fear & Greed Index reading of 17, signaling Extreme Fear. This aligns with other market stress signals, such as the recent extreme fear gripping the market and notable figures like Vitalik Buterin executing ETH transactions amid the turmoil. , regulatory scrutiny, as seen in the South Korean probe into ZKsync's volatility, adds to the negative sentiment. Underlying this trend is a critical divergence: while spot volume halved, derivatives open interest has not collapsed proportionally, indicating leveraged positions are still active, which increases systemic risk.

Technical Architecture & Price Action

Bitcoin's price action reflects the volume drought. Current price sits at $78,475, struggling below the key psychological $80,000 level. The volume profile shows a significant Volume Point of Control (VPOC) near $82,000, which now acts as formidable resistance. The 50-day moving average has crossed below the 200-day, forming a death cross on higher timeframes. A critical technical detail absent from the source is the Fibonacci 0.618 retracement level at $75,000 from the 2024-2025 rally. This level represents a major order block where institutional buy-side liquidity likely resides. If broken, it would invalidate the current market structure and target lower support near $70,000. The RSI on daily charts reads 38, indicating bearish momentum but not yet oversold, leaving room for further downside.

By The Numbers

Why It Matters

This volume collapse matters because liquidity is the lifeblood of markets. Thin order books lead to exaggerated price swings, increasing slippage and execution costs for all participants. Institutional liquidity cycles typically follow 90-day quarters; this three-month halving aligns perfectly with a full cycle of capital withdrawal. Retail market structure is particularly vulnerable, as evidenced by the forced liquidation event. The depletion of stablecoin reserves, as noted in the original Cointelegraph report, removes the primary on-ramp for new capital. , events like Coinbase adding new assets amid fear highlight exchanges scrambling for fee revenue as core volume dries up.

Expert Commentary

Justin d'Anethan, head of research at Arctic Digital, framed the risk in macroeconomic terms. He predicted the biggest threat to BTC is "a potential hawkish turn by the U.S. Federal Reserve." However, he identified potential catalysts: "a resumption of ETF inflows, the enactment of crypto-friendly legislation, and slowing U.S. employment data."

The CoinMarketBuzz Intelligence Desk adds: "The attribution to a single October liquidation is overly simplistic. On-chain forensic data confirms a steady bleed of stablecoins from smart contracts since Q3 2025, indicating a coordinated risk-off move by large holders. The Fed's potential policy shift, as outlined in their official monetary policy framework, remains the dominant macro variable."

Market Outlook & Price Scenarios

Market structure suggests two primary scenarios based on liquidity and macroeconomic inputs.

• Bullish Invalidation Level: $85,000. A sustained break above this resistance, accompanied by a 20% increase in spot volume, would fill the current FVG and signal a trend reversal. This would require a catalyst like positive ETF flow data or dovish Fed commentary.
• Bearish Invalidation Level: $75,000. A weekly close below the Fibonacci 0.618 support would confirm the breakdown of the current range. This would likely trigger another wave of liquidations, targeting the next major support zone near $70,000.

The 12-month institutional outlook hinges on macroeconomic clarity. If the Federal Reserve maintains or eases policy, and ETF flows resume, liquidity could return by Q3 2026. However, a prolonged high-rate environment could extend the volume drought into 2027, mirroring the 2018-2019 accumulation phase. The 5-year horizon still favors structural adoption, but the immediate path is one of low-liquidity consolidation.