Cryptocurrency trading volume surges past $10 trillion, hitting an all-time high: Market fervor fueled by new US administration policies

Cryptocurrency trading volume surges past $10 trillion, hitting an all-time high: Market fervor fueled by new US administration policiesIn November 2024, cryptocurrency market trading volume eclipsed the $10 trillion mark for the first time, reaching an unprecedented high. This staggering figure signifies a new phase of development for the cryptocurrency market

Cryptocurrency trading volume surges past $10 trillion, hitting an all-time high: Market fervor fueled by new US administration policies

In November 2024, cryptocurrency market trading volume eclipsed the $10 trillion mark for the first time, reaching an unprecedented high. This staggering figure signifies a new phase of development for the cryptocurrency market. According to CCData, November's total cryptocurrency trading volume more than doubled compared to the previous month, with both spot and derivatives trading hitting record highs. Spot trading volume surged by 128% to $3.43 trillion, second only to the peak in May 2021, while derivatives trading volume increased by 89% to a record-breaking $6.99 trillion.

This surge in trading volume is not an isolated event; it's closely linked to the global macroeconomic environment and policy expectations. Particularly noteworthy is the explosive growth in South Korea, where the cryptocurrency market's fervor has even noticeably squeezed the stock market. Since certain key political events, several South Korean spot cryptocurrency exchanges, such as Upbit, have seen a dramatic increase in trading volume. The influx of investors into the altcoin market has caused the KOSDAQ index to fall by 8%, potentially making it one of the worst-performing Asian stock indices this year.

This phenomenon stems from market expectations regarding the future regulatory environment. Analysts widely believe that the election of a particular political figure and their publicly expressed positive stance towards cryptocurrencies have boosted investor confidence. Investors anticipate a more friendly and relaxed regulatory approach from the new administration, creating a more favorable environment for the cryptocurrency market. This expectation acted as a catalyst, igniting market enthusiasm and driving the continued surge in trading volume.

Further supporting this viewpoint is the appointment of a pro-cryptocurrency official as the Chair of the US Securities and Exchange Commission (SEC) shortly after the politician's inauguration. This move was interpreted by the market as a signal of government support for the cryptocurrency industry, further bolstering investor confidence. Jacob Joseph, Senior Research Analyst at CCData, noted: "This positive sentiment is clearly reflected in the increased demand for assets like Ripple, which has long faced intense regulatory scrutiny but recently shown strong growth."

The optimism of institutional investors is also noteworthy. Trading volume on the Chicago Mercantile Exchange (CME) has significantly increased, and the inflow of funds into spot Bitcoin ETFs over the past month has been considerable, indicating that institutional investors are stepping up their investment in the cryptocurrency market. The entry of these institutional investors not only brings substantial capital but also more sophisticated investment strategies and risk management methods, further driving market development and maturation.

Bitcoin, the flagship cryptocurrency, has also benefited from this market boom. At press time, Bitcoin's price stands at $98,433.8 per coin, representing a year-to-date increase of over 122%. This surge reflects the market's optimistic outlook on cryptocurrencies and investors' recognition of Bitcoin as a store of value and an investment asset.

Of course, the market is not without risk. Cryptocurrency markets remain highly volatile, and investors should still exercise caution. However, the November trading volume exceeding $10 trillion, an all-time high, undeniably marks the cryptocurrency market's entry into a new development phase, with its influence growing and its impact on the global financial system becoming increasingly undeniable. In the future, with further regulatory clarity and technological advancements, the cryptocurrency market is poised for even more robust growth.

The November trading volume data also reveals changes in the structure of the cryptocurrency market. The increase in spot trading volume indicates that more investors are focusing on the long-term value of cryptocurrencies rather than simply viewing them as speculative instruments. The growth in derivatives trading volume reflects the increasing demand for risk management, with investors actively utilizing derivatives to hedge risks. This suggests that the cryptocurrency market is becoming more mature and sophisticated.

It's important to note that this surge in trading volume isn't entirely driven by speculative behavior. Many businesses and institutions are actively exploring the applications of cryptocurrencies in payments, supply chain management, and other areas, providing new growth drivers for the cryptocurrency market. With continuous technological advancements and expanding application scenarios, the cryptocurrency market is expected to gain wider adoption and have a more profound impact on the global economy in the future.

The November trading volume data also highlights the globalizing trend of the cryptocurrency market. Asian markets, particularly South Korea, played a significant role in this surge. This shows that the cryptocurrency market is no longer confined to a few developed countries but is expanding globally, providing more investors with opportunities to participate.

However, global regulatory uncertainty remains one of the main challenges facing the cryptocurrency market. Regulatory policies vary significantly across different countries and regions, creating difficulties for cross-border trading and investment. Therefore, the standardization and transparency of future regulatory policies will be crucial for the healthy development of the cryptocurrency market.

In summary, the surpassing of the $10 trillion mark in November's cryptocurrency trading volume signifies a new historical stage for the cryptocurrency market. This breakthrough not only reflects the market's optimistic outlook but also foreshadows even more vigorous growth in the future. Driven by policy expectations, institutional investment, and technological advancements, the cryptocurrency market is increasingly maturing and exerting a more profound influence on the global financial system. However, regulatory uncertainty and market volatility remain factors that require close attention.