Announcement header or pricing ticker

DHS Inquiry Leads to Lowest USD/Bitcoin Trading Volume In Months

Bitcoin trading volume has plummeted since news broke that the Department of Homeland Security issued a seizure warrant that stopped all activity between Dwolla and the Mt. Gox exchange. As of today, the 5-Day moving average of USD trading volume is at the lowest level in at least a year and a half (the data is a bit spotty beyond that), other than the last week in December 2012.

5Day EMA Volume

In addition to total market volume declining, Mt. Gox is losing footing as the dominant player in the space. As of May 17, Gox was doing roughly 81% of total USD bitcoin volume. Today they did just 59%.

share of exchange volume

Not only has volume fallen across all exchanges since the DHS announcement on May 14 – there’s also been a notable shift market share between exchanges. Btce has grown from 8% to 14% of total daily USD/BTC volume, while Bitstamp has climbed from 10% to an impressive 24%.

trading vol by exchange 2

For better or for worse, this has also led to the lowest USD/BTC rate volatility since the same end-of-2012 time period.

rate volatility
5-day moving average exchange rate volatility lowest since the last week of 2012
final graph
Trading volume and volatility flat-lined after the DHS halts a major funding source of the top BTC exchange.

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