August Market Behavior in Cryptocurrency

August is usually marked by reduced cryptocurrency market activity and a slump in the value of major tokens, according to Coinbase analysts.

“Seasonality hasn’t typically worked in crypto’s favor for the month of August,” Coinbase analysts David Duong and David Han noted.

In the Coinbase Weekly report released on Friday, the analysts mentioned that August has historically experienced lower market activity. For instance, Bitcoin spot volumes dropped 19% in August 2023 compared to June of the same year, with bitcoin futures volumes also down 30% over the same period across global centralized exchanges.

“Bitcoin (BTC) averages a decline of 2.8% during this month over the last five years, and lower liquidity and trading volumes can lead to increased volatility during August,” they added. They suggested that similar lackluster behavior may be witnessed this year.

Lack of Liquidity and Price Ranges

Bitfinex Head of Derivatives Jag Kooner also indicated that August might experience a lack of liquidity in many assets, attributing this to the seasonality of the month.

“We are currently seeing significant buy walls being built at range lows on several altcoins,” Kooner said, adding that he expects Bitcoin prices to fluctuate between $61,000 to $70,000, creating an accumulation zone.

As of publication, Bitcoin was trading around $65,189, reflecting a 1.2% increase over the past day, according to The Block’s Bitcoin Price Page.