Off-chain volume increases while volume decreases, Bitcoin price maintains range fluctuation.

Gate News bot news, according to a report released by Glassnode on Thursday, while the price of Bitcoin (BTC) broke the $100,000 mark, the volume also saw a significant decline. The decline in volume is mainly due to a drop in non-monetary volume, leading to an overall decrease in throughput.

The average volume of BTC is $36,200, indicating that although the number of transactions has decreased, each transaction still holds sufficient value. This suggests that despite the reduction in on-chain activity, large entities are still actively using the Bitcoin network.

However, this also reveals the discrepancy between the continuously growing market value of Bitcoin and the usage of its underlying network. In previous bull market cycles, price increases would lead to severe on-chain congestion and rising transaction fees.

Glassnode's Fee Revenue Multiple (FRM) - a ratio that can insight into miner income dominance - shows that despite Bitcoin's trading price being close to its all-time high, on-chain fees remain at low levels.

As on-chain activity decreases, most of Bitcoin's trading volume is now being pushed towards centralized exchanges. Glassnode highlights the growing influence of centralized trading platforms, which have facilitated most of the Bitcoin trading activity in this cycle.

Glassnode reported: "When comparing off-chain volume (spot, futures, and options) to on-chain settlement value, we noticed that off-chain volume is typically 7 to 16 times that of on-chain volume."

With the rise of off-chain volume, the open interest in derivatives continues to grow, highlighting the increase in leveraged trading.

The report indicates that compared to the levels in 2023, the changes in total open contracts for Bitcoin over a 30-day period have become increasingly unstable. While open contracts remained stable throughout 2023, they began to fluctuate after the launch of the US spot ETF in January 2024.

Glassnode believes that the rise in this volatility indicates a broader market shift, typically from a spot-dominated market structure to a derivatives-dominated market structure. The report further adds that this shift "increases the risk of chain liquidations" and may lead to a more unstable market environment.

Due to broader macroeconomic factors continuing to affect Bitcoin prices, Bitcoin continued to trade above $104,000 on Friday.