Bitcoin market in 'hibernation' as perp trading activity sinks to three-year low ahead of US CPI release: K33

Bitcoin perpetual trading activity has fallen to its lowest level since 2023 following months of rangebound price action, leaving the market unusually quiet ahead of key U.S. inflation data on Wednesday.

The 30-day average combined trading volume for BTC/USDT perpetuals on Binance and Bybit declined to $10.8 billion as of Aug. 10, according to research and brokerage firm K33. Only 5% of days since January 2021 have recorded lower 30-day average volumes across the two products, concentrated in late 2022 and 2023, Head of Research Vetle Lunde said in a new report.

Spot activity has also dried up. Average daily bitcoin spot volume fell 18% over the past week to $1.8 billion, per K33's data, marking the lowest one-week average since February 2024. 

Bitcoin's seven-day volatility mirrors this, dropping to 0.6% on Sunday to print the lowest reading since Christmas 2025. "Low trading activity invites a pale and slow market, while a slow and pale market gives traders little incentive to participate, creating a self-reinforcing circle of hibernation," Lunde said.

Elevated leverage raises liquidation risk

The subdued trading comes despite relatively high perpetual open interest throughout the summer. Open interest in bitcoin perpetuals has averaged around 300,000 BTC between June 1 and Aug. 11, compared with a 2026 average of 288,000 BTC and 282,000 BTC across 2025 and 2026, according to K33.

"This suggests that relative leverage in the market remains elevated, creating modestly heightened risks of amplified volatility and trading activity stemming from liquidations," Lunde said. "The prolonged combination of elevated open interest and volatile, yet relatively moderate, funding rates leaves the market exposed to liquidation-driven moves in either direction."

Traders now await the July U.S. Consumer Price Index report, scheduled for release at 8:30 a.m. ET on Wednesday, which could help shape expectations on the Federal Reserve's next interest rate decision.

Economists polled by Reuters anticipate headline CPI to rise 0.1% month over month and 3.4% year over year, while core CPI is forecast to increase 0.2% month over month and 2.5% year over year. Markets are currently pricing in an approximate 50% chance of a 25-basis-point hike at the September meeting going into the release, according to the CME FedWatch tool.

Bitcoin has traded between roughly $60,000 and $80,000 for six consecutive months and remains close to a 50% drawdown from its October 2025 all-time high. K33 noted that the prolonged consolidation differs from the 2014, 2018, and 2022 bear markets, when bitcoin continued establishing lower lows, while onchain data suggests coins are moving back into the hands of long-term holders.