Trading volume

Author

@paulapivat (paul_apivat#3817)

Description

Trading volume represents the total number of shares (stocks, securities) traded in a given time period; it is a technical indicator that confirms the existence of a trend [1]. According to Coinbase, trading volume is the total amount of cash or crypto exchanged between buyers and sellers for a cryptocurrency or NFT collection [2]. Similarly, Coinmarketcap’s Alexandria suggests volume is the sum total of actual trades taking place [3].

Related Term

Wash trading. Because some exchanges inflate trading volumes with wash trading, some data providers like Messari will report “Real Volume” [4].

References

  1. Nickolas, Steven (Updated April 01, 2022) Using Trading Volume to Understand Investment Activity. URL: https://www.investopedia.com/ask/answers/041015/why-trading-volume-important-investors.asp

  2. Coinbase Help: URL: https://help.coinbase.com/en/coinbase/getting-started/crypto-education/glossary/volume-traded

  3. Coinmarketcap Alexandria. URL: https://coinmarketcap.com/alexandria/glossary/volume

  4. Messari Proprietary Methods: https://messari.io/report/messari-proprietary-methods

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