Trading volumes on major cryptocurrency exchanges hit a daily record on Monday of over $68 billion, research showed, highlighting the trading frenzy that has accompanied bitcoin’s charge to an all-time high.
Bitcoin hit a record high $34,800 on Sunday, building on a 2020 rally that saw it more than quadruple as bigger U.S. investors jumped into the market. It then fell sharply on Monday amid volatility in highly leveraged futures markets, before recovering losses.
The second-biggest cryptocurrency, ethereum, which tends to trade in tandem with bitcoin, also on Monday hit its highest level since January 2018, touching $1,170.
Overall daily trading volumes in cryptocurrencies hit $68.3 billion, the data from UK research firm CryptoCompare showed on Tuesday. Daily volumes had averaged $13.1 billion in 2020, the data showed.
Bitcoin’s record high came less than three weeks after it crossed $20,000 for the first time on Dec. 16.
Fuelling bitcoin’s rally has been the perception it can act as a hedge against the risk of inflation as governments and central banks turn on the stimulus taps to counter the COVID-19 pandemic. Its potential for fast gains also attracted demand.
Crypto trading volumes regularly spike during periods of extreme price swings, highlighting the central role for speculative traders in digital currency trading.