Bitcoin (BTC) remained confined to its late November trading range near $90,000 Friday as daily volume declined 9% to $38 billion.
Reduced liquidity has amplified short-term price swings across major cryptocurrency, with sharp moves frequently reversing.
Altcoins delivered mixed performance with Zcash (ZEC) rebounding more than 14% from Thursday's lows while SKY and TON underperformed.
What Happened
Bitcoin's daily trading volume has fallen significantly from the $80 billion to $130 billion range observed months ago.
Reduced trading activity has created choppy price action that punishes leveraged traders through rapid reversals.
Zcash recovered sharply after initially falling 18% following the January 7 resignation of the entire Electric Coin Company development team over governance disputes.
Over $200 million in crypto futures liquidations occurred over 24 hours, down from $400 million in prior days.
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Why It Matters
Bitcoin's volatility index cooled to 43% from 47.3%, reversing its late December spike as traders showed limited concern ahead of economic data releases.
Total notional open interest in crypto futures declined to $138.5 billion from over $141 billion earlier this week.
The combination of compressed volatility expectations and declining trading volumes suggests markets are waiting for catalysts before establishing new directional trends.
Zcash's governance crisis highlighted cryptocurrency networks' resilience when protocols operate independently of any single development entity.
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