Leverage Surpasses Liquidity as Bitcoin Spot Trading Volumes Decline by 40% Since January

The landscape of Bitcoin trading has undergone a significant transformation, with leveraged derivatives now representing the majority of daily trading activities.

Statistics indicate that in 2025, more than 90% of Bitcoin’s trading activity came from derivatives, leading to an average derivative-to-spot volume ratio of 13.2 times year-to-date. This ratio reached a high of 16.6 times on May 6, coinciding with Bitcoin’s price closing near $96,800.

The acceleration towards derivatives became notably pronounced in March and April. As Bitcoin’s price fell to around $80,000 in late March and began to rise again in April, the flow of derivatives increased while spot trading remained subdued.

A significant surge in volume was recorded on April 7, when derivatives surpassed 1.26 million BTC in a single day, whereas spot trading struggled to breach the 30,000 BTC mark. Since mid-February, daily spot volumes have typically remained below this threshold.

This pattern corresponds with earlier findings that indicated the recent price recovery since February wasn’t fueled by new investments or robust retail activity on exchanges.

The data clearly reveals an inverse relationship between leverage usage and price momentum. The correlation observed between the daily derivative-to-spot ratio and Bitcoin’s spot price stands at –0.40 year-to-date, suggesting that higher dominance of derivatives tends to coincide with weaker price performance.

This trend has been consistently observed throughout the year: in March and April, derivatives accounted for over 95% of total volume on several occasions, particularly after local peaks and declines in Bitcoin’s price.

During January’s surge past $100,000, spot trading volumes occasionally exceeded 100,000 BTC, including a notable spike on January 20 that aligned high spot activity with a local price peak. Since that time, such robust spot trading has diminished. In April and May, even with prices nearing previous highs, spot volumes remained low, rarely exceeding 20,000 BTC per day.

Overall volume statistics further support this perspective. From January 1 to May 6, the total volume for spot trading was merely 4.15 million BTC, in stark contrast to over 50.5 million BTC in derivatives. Consequently, futures markets have accounted for more than 92% of Bitcoin’s daily trading activity throughout the year.

The growing derivative-to-spot ratio, which rose from 11.27 times in January to 13.77 times in May, illustrates this shift toward a leverage-centric market structure. Even though volatility has decreased since March, the increasing ratio highlights an ongoing dependence on margin and futures trades for directional speculation.

This structural disparity poses considerable risks. When spot market liquidity decreases, price discovery becomes increasingly susceptible to leverage adjustments, with funding rates or liquidation events having the potential to move prices dramatically, regardless of actual trading volumes. Sparse order books can lead to rapid price declines under even minor selling pressure, especially when trading is heavily skewed in one direction on the futures curve.

The apparent lack of genuine demand in the spot market may hinder Bitcoin’s upward potential unless there is a resurgence of ETF inflows or significant on-chain accumulation. Currently, behavior in the spot market suggests that demand is primarily synthetic, with minimal real buying pressure evident on exchanges.

Until there is an uptick in spot activity that aligns with price strength, the market remains precarious: reactive yet driven by exposure rather than firm conviction.