- Bitcoin spot trading volumes fell 81% since October 2025 as exchange activity weakened.
- Hedge funds raised U.S. equity short exposure while Bitcoin volatility stayed elevated.
- Binance remained the top BTC exchange despite declining crypto market participation.
Bitcoin spot trading activity has declined across major crypto exchanges, with monthly volumes falling to levels last seen during the July 2023 bear market. The slowdown comes as institutional investors adopt more defensive positioning in U.S. equity markets and Bitcoin increasingly diverges from traditional risk assets.
Data shared by market analyst Darkfost showed that Bitcoin spot trading volumes have dropped by 81% since October 2025. Binance, which remained the largest exchange by trading volume, recorded roughly $36.4 billion in BTC spot volume, down from approximately $198.6 billion. The data also showed major declines across other exchanges, including a 79.6% drop on Gate.io and a 66% decline on Bybit.
According to the chart, Binance continued to dominate Bitcoin spot liquidity between 2023 and early 2026 despite the slowdown in activity. Binance reached its highest monthly BTC spot trading volume of nearly $333.6 billion in March 2024, followed by another major rise in late 2024, with volumes exceeding $246 billion before declining throughout 2025 and early 2026.
Trading Slowdown Reflects Changing Risk Conditions
According to the data, the decline in trading activity coincided with a macroeconomic environment that became less supportive of risk assets. Rising inflation pressures and the prolonged U.S.-Iran conflict were identified as factors contributing to reduced crypto market participation as investors shifted attention toward commodities and traditional equity markets.
At the same time, the drop in spot activity showed that selling pressure behind Bitcoin’s recent retracement may be weakening. Historical comparisons cited by Darkfost showed that similar volume collapses occurred near the end of the 2023 bear market, followed by a return in volatility and a recovery in crypto prices.
Equity Market Hedging Draws Attention to Bitcoin Correlation
Separate market data shared by XWIN Japan showed that short interest in U.S. equities has climbed to high levels. Hedge fund gross leverage approached 293%, while S&P 500 short exposure and Days-to-Cover metrics reached record territory.
The report noted that institutional positioning remained concentrated in large AI-related stocks while smaller-cap sectors experienced heavier short activity. Although the S&P 500 continued trending higher with relatively low volatility, Bitcoin displayed larger price swings throughout 2025 and 2026.
Charts comparing Bitcoin’s 90-day Spot Taker CVD with the S&P 500 showed strong buy pressure returning during several periods of BTC recovery. TF inflows and spot market buying activity also suggested Bitcoin was increasingly decoupling from equity market performance, even as both asset classes remained sensitive to broader macro liquidity conditions.
Related: Bitcoin Price Drops Below $77,000 After Failed $80,000 Breakout
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
