Poor Bitcoin Market Liquidity Keeps Crypto Whales at Bay

) market despite a risk reset in traditional markets because thin liquidity is making transacting without impacting the cryptocurrency's price difficult.

In signs of the increasing appetite for risk, stocks have gathered upside traction while the U.S. dollar has taken a beating on optimism that China’s reopening is gaining steam and the Federal Reserve may be close to winding up its liquidity-tightening cycle. In crypto, however, market depth – a measure of an asset's price resilience to large orders – is relatively low and discouraging activity.

"Aggregated 2% BTC market depth has dropped by almost half to around 8,000 BTC from 14,000 BTC at the end of October," analysts at Bitfinex, one of the top 10 centralized cryptocurrency exchanges by volumes, wrote in the Jan. 9 issue of the market report."In other words, a large order of the same USD value or size placed today will have more than twice the impact on price in contrast to two months ago.

Crypto pundits typically keep track of the 2% market depth to assess liquidity conditions. The gauge represents a collection of the buy and sell orders within 2% of the mid-price – the average of the bid and the ask/offer prices being quoted at a given time. "This is very discouraging for whales and larger trading firms actively trading crypto purely as an alternative publicly traded market," the analysts said.

godbole17 Friendly remind take your Bitcoin off exchanges

godbole17 Sure the lack of liquidity in the Bitcoin market can create volatility and make it difficult for large traders to move in and out. But more institutional players are entering the market with more liquidity. It's just a matter of time before🌕

godbole17 That’s what happens when markets are oversold

godbole17 oh poor poor whales /s

godbole17 👀💡

godbole17 Volume has to pick up for a significant rally.

godbole17 Translate: bitcoin to da moon !

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