Bitcoin spot trading activity has fallen to its weakest level of the year, even as a fresh signal from CryptoQuant suggests that one critical piece of selling pressure may be starting to fade.

CryptoQuant contributor Darkfost said February will soon end with the month with the lowest bitcoin spot volumes since early 2024. He linked the slowdown to a broader retreat in risk appetite as investors pull back from directional exposure and wait for more solid macro or technical confirmation.

“February is on track to close out as the month with the lowest Bitcoin spot volumes since early 2024. This coincides with levels of renewed BTC price growth last seen in 2024 as well.” – wrote Darkfost on X. “The current climate of uncertainty around BTC has pushed investors to a more defensive stance, resulting in a clear reduction in risk-taking.”

Bitcoin liquidity is constantly decreasing

The scale of the slowdown is evident in all the most critical facilities. Dark Fost he said Binance continues to lead by a wide margin with almost $75 billion in February spot trading volume, followed by Gate.io with $25 billion and Bybit with $20 billion. Still, this dominance didn’t save Binance from a broader decline.

The post shows that since Bitcoin’s last record high in October, monthly spot trading volumes have been roughly halved on major exchanges. Binance dropped from $198 billion to $75 billion, Gate.io from $53 billion to $25 billion, and Bybit from $41 billion to $20 billion. Rather than address the stock issue, Darkfost characterized the move as a reduction in market share across the entire market.

He also linked the deterioration in liquidity to the aftermath of the October 10 shock, when open interest fell by more than 70,000 BTC, or about $8 billion, following a edged reset of leveraged exposure. According to him, this event had an impact not only on the positioning of derivatives. This appears to have accelerated a broader exit from cryptocurrency trading activities.

“This phase of withdrawal is directly reflected in the steady decline in spot trading volumes seen on major exchanges,” Darkfost wrote. “These dynamics indicate a generalized trend affecting all major exchanges.”

This matters because cash flows tend to matter more when investors are looking for evidence of sustained demand rather than rapidly changing leverage. A recovery based on stronger cash market participation generally looks more strong than a recovery driven primarily by derivatives.

Coinbase pressure shows signs of easing

Against this delicate backdrop, CryptoQuant CEO Ki Young Ju pointed to a more constructive short-term signal: “Selling pressure on Coinbase is easing.”

The chart shows that the Coinbase Premium Index is back in positive territory after spending most of February below zero (with a few exceptions). At the last chart reading, the premium had increased to around 0.006, while Bitcoin was trading near $68,300. This suggests that discounts on Coinbase relative to offshore facilities have narrowed, alleviating one of the signs of US-led selling pressure.

This doesn’t negate Darkfost’s broader caution. If anything, these two signals match. Spot market liquidity remains low and the market continues to operate in a low-confidence environment, but one of the more closely watched measures of immediate selling intensity is no longer deteriorating.

Darkfost clearly stated what needed to be changed for the image to improve in a more significant way. “In the current environment, this simultaneous reduction in spot trading volumes reflects a structurally cautious market phase in which participants are prioritizing capital preservation over directional exposure while awaiting clearer macroeconomic or technical signals. Stronger support for spot trading volumes will be necessary for an upward recovery to materialize or for a lasting bottom to form.”

For now, this leaves Bitcoin in a familiar end-of-cycle holding pattern: sellers may be pulling out of Coinbase, but without a broader return in spot demand, the market still lacks the depth that usually underpins a stronger move.

At the time of publication, Bitcoin was trading at $68,153.

Featured image created with DALL.E, chart from TradingView.com