Bitcoin Price Showing Wide Variance on Major Exchanges Tuesday

The price of bitcoin declined on Tuesday, though the extent of the fall and subsequent consolidation depends largely on the exchange one is using. Bitcoin’s quoted value differs by more than $150 on Coinbase and Bitfinex, two of the world’s leading exchanges.

BTC/USD Update

Bitcoin clocked a new two-week low on Coinbase Monday, as prices bottomed near $6,250. At the time of writing, the quoted price for BTC/USD on Coinbase was $6,286, a decline of 1% from 24 hours ago.

The leading digital currency continues to enjoy a large premium on Bitfinex, where prices were trading near $6,450. The large premium paid on Bitfinex may reflect the poor price performance of USDT, a controversial stablecoin that is used to buy bitcoin. USDT fell 0.6% on Tuesday to $0.9879. A selloff of Tether’s stablecoin was largely responsible for bitcoin’s sudden spike last month, which produced large premiums on Bitfinex, an exchange with heavy USDT turnover.

Bitcoin’s average price on Tuesday is $6,371, according to CoinMarketCap. Daily trade volumes are holding strong at $4.6 billion. Derivatives trading continues to be one of the more popular methods of accessing the bitcoin market. BitMEX,  a popular derivatives platform, processed nearly one-fifth of bitcoin’s total volume on Tuesday.

Bitcoin Maintains Stable Trading Range

Although bitcoin has exhibited more weakness in the last five days, overall trading patterns have remained stable, underscoring the sharp drop in volatility seen throughout the year.

Bitcoin’s 30-day volatility index, which measures daily fluctuations for the digital currency, plummeted to 1.03% on Tuesday, according to Bitvol.info. That’s the lowest level in over two years. As the following chart illustrates, bitcoin’s volatility over time peaked at two-year highs in February but has been declining ever since.

Lacking any major trading catalysts, bitcoin continues to find support in the low $6,000 price range – a region that is normally associated with mining costs. According to analysts, market participants should keep a close eye on $6,200, as this not only signals a bearish breakdown for bitcoin but the broader market as well. That’s because bitcoin continues to exert a magnetic pull on the broader market.

In terms of fundamental developments, market participants are looking ahead to the launch of Intercontinental Exchange’s Bakkt trading platform next month. The first product to be launched on the platform will be a physically settled bitcoin futures contract, offering institutional investors new ways of accessing the digital currency market.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Author:
Chief Editor to Hacked.com and Contributor to CCN.com, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi