When Is The Best Time To Trade Crypto?

The cryptocurrency markets are available worldwide for anyone to trade. But there are specific times that offer the best opportunities.

Key Takeaways:

  • For those seeking the highest levels of liquidity and trading volume, trade crypto during the opening of the US (8 am to noon) and European stock markets (3 to 7 pm EST).
  • 43% of Bitcoin trades are executed when the US stock market is open which is one of the best time frames to trade.
  • Due to lower trading volume and higher volatility, the weekends can present great profit potential for advanced investors.

One of the best things about the crypto markets is that trading is available 24/7. It is highly accessible to traders worldwide with ample opportunities to make potential profits on their investments. But is there a particular time that is best for trading crypto? This article will explore when the crypto markets open and close, and what times are best for cryptocurrency trading to provide maximum opportunity for various trading strategies and financial goals.

Are Crypto Markets Always Open?

The short answer is yes, the cryptocurrency markets are open 24/7. They are accessible globally and do not close on weekends, public holidays, or for any other event. Unlike trading stocks, which put a limited window for traders to buy and sell stocks, the cryptocurrency market doesn't have an end time.

Can The Crypto Market Close?

Even though the global markets are always open, the liquidity and trading volumes across various crypto trading exchanges can vary dramatically. There are instances where a certain exchange will halt trading on a specific crypto pair – however, this does not mean the crypto market is closed as the same pair may be free to trade on a different platform. The reasons an exchange may restrict trading a crypto asset:

  • Problems with liquidity
  • Extreme volatility (potentially signalling a crypto pump and dump scheme)
  • Suspicious trading activity or hack
  • Scheduled maintenance
  • Insolvency issues

In isolation, a single coin or pair being unavailable for trading on an exchange will have no bearing on the broader crypto market. However, if a platform or token integral to the blockchain ecosystem experiences one of these problems, the overall market might be affected. This is known as a contagion – the most famous example being FTX’s collapse in 2022. However, even in these circumstances the crypto market isn’t actually closed.

What is The Best Time to Trade Cryptocurrency?

The best time to trade the crypto markets will always depend on the individual’s trading strategy and goals. The location of a trader will also play a role in when and how to enter a trade. For example, US and European markets (8 am to noon EST) and (3 to 7 pm EST) do have the greatest trading volume and liquidity and will present the most trading opportunities.

There are exceptions to the rule as low liquidity times (e.g. weekends) can also provide significant trade opportunities. While this is unlikely to affect big market-cap coins such as BTC and ETH, lesser-known coins can experience massive bid-ask spreads due to “whales” placing big orders. This can result in extreme price movements – a massive opportunity for experienced traders, but a potential trap for novice investors.

An easy way to confirm high-activity trading times is to use a 24h Crypto Volatility Index (VIX). This makes it easy to identify the current market activity, as well as peak times throughout the day. The crypto volatility index can be viewed on Tradingview or on the CVI Finance website as shown below.

crypto volatility index
Crypto volatility index on CVI.Finance.

Should You Trade Crypto On Weekends?

Whether one should trade crypto on the weekend or not largely depends on the experience of the trader, their strategy, and their ability to monitor positions. Weekends generally have lower liquidity and trading volume compared to business hours. Although, Saturday (+0.69%) is traditionally one of the most profitable days for astute crypto investors (trailing behind Friday).

High-net-worth individuals and institutions will take advantage of weekend conditions to move the prices of crypto assets without any significant opposing bid or ask orders. This can result in large price wicks across several trading pairs and particularly on the lower timeframes as most major institutional players and investors aren’t participating in the market. When the market direction is dictated by volume from inexperienced investors, market makers, and trading bots, it can very quickly be wiped out within a few hours of professionals trading on Monday.

When Does Most Crypto Exchange Market Activity Occur?

Cryptocurrency is correlated to the traditional stock market. Therefore, its trends are usually quite similar. The crypto market will nearly always experience the most trading volume at the same time as the American stock markets are open.

Approximately 43% of all Bitcoin trades are executed during US market hours. Conversely, Asian and European market opens have significantly less impact on BTC trading volume. Most crypto exchange market activity occurs between 3 and 4 pm UTC (10 and 11 am EST), especially on major platforms like Binance and Coinbase. It’s worth noting that 10a m EST is when the New York Stock Exchange opens for trading.

Average trading volume by hour
Average trading volume by hour. Source: Arcane Crypto.

Statistics That Help Show The Best Time To Trade Crypto

Trading Volume

Crypto trading volume is an easily accessible stat that can quickly show investors how many trades are being made at any given time. It can be a quick way to confirm if the market is in peak hours, or if a certain exchange is performing as expected. Coinmarketcap, Blockchain.com, and Chainalysis are all useful cryptocurrency tools to use for this purpose. Looking at this volume graph of Bitcoin/USDT shown below, the red arrows mark Sundays which shows a declined volume compared to other business days in the week.

Trading volume on bitcoin chart
Trading volume on bitcoin chart.

Average Trade Duration

Assessing average trade duration is a good way to identify liquidity in the market. This can be identified via platforms like Coinmarketcap or an alternative, or by assessing individual blockchains through a block explorer. Periods of high average trade duration are typically bad times to trade, as investors are susceptible to slippage (price changes between orders being placed and executed).

Average Return On Investment (RoI)

Average ROI statistics for the crypto market can be difficult to source outside of in-depth studies. Based on these, Monday and Friday have been the most profitable days. This is likely because they are also the highest-volume days. Weekends also tend to underperform (0.17% average return) compared to weekdays (0.29%).

Stablecoin Inflows To Exchanges

It’s easy to assume Bitcoin would be the highest-volume crypto – but for the most part, it is actually the stablecoin Tether (USDT). USDT and other stablecoins are used by advanced traders, particularly those using derivative instruments, to form one part of a trading pair. Assessing stablecoin inflows is an accurate way of seeing how many institutional/professional traders are currently active. A platform such as CryptoQaunt or Dune can provide real-time data on stablecoin exchange in and outflows.

Other Factors Influencing The Best Time To Trade Crypto

  • Individual’s location. The prime trading hours for cryptocurrency are during US market hours – an individual’s location may make trading at such a time unfeasible. For example, 4 pm UTC is equivalent to 12 am in Singapore which may not suit their preferred trading strategy.
  • Market volatility. This can be an intimidating concept for new traders, but periods of high volatility actually present favorable profit opportunities for experienced investors. Advanced traders could target weekends or the market closes to find lucrative buy/sell openings on low-volume assets.
  • Liquidity. Periods of high trading volume and liquidity can occasionally equate to faster-moving trends (i.e. higher volatility) for the biggest crypto assets like Bitcoin and Ethereum. Except in specific circumstances, traders should nearly always target exchanges with excellent liquidity, as low liquidity can lead to slower trades, slippage, and loss of profits. Using a crypto scanner is a useful tool to identify the liquidity of cryptos on exchanges.
  • Market capitalization. High market-cap cryptocurrencies are less likely to be affected by trading hours, volatility, and liquidity troubles. Picking a specific time of day is often less important when buying digital currencies like Bitcoin and Ethereum than more obscure, lower market cap alternatives. Additionally, a higher market cap equates to higher supply – which means more investor money is floating around the markets.

Frequently Asked Questions

Is it better to trade crypto during the day or night?

It entirely depends on the individual trader’s location. Investors from the US will likely find better trading conditions during their daytime, whereas traders in different time zones might need to trade early in the morning for optimal liquidity and volume.

What hours is crypto most active?

The crypto market receives the most trading volume between 3 and 4pm UTC – the same time the New York Stock Exchange opens. Generally, digital asset markets are most active while the major American financial markets are open.

Does crypto usually go up or down on weekends?

Analysis suggests that the crypto market returns less on weekends compared to weekdays. Due to lower trading volume and higher volatility, the weekends can present great profit potential for advanced investors.

Conclusion

The crypto markets are open 24/7, giving traders a whole host of ways to capitalize on varying market conditions. Generally, the crypto market is at its peak during the trading hours of the New York Stock Exchange and other major American stock markets. This makes it the best time for investors to capitalize on low-liquidity, low-slippage trades that will ultimately lower the crypto fees on each trade. At the same time, the high volatility of the weekends presents great opportunities for experienced, higher-net-worth traders.

Finding a specific time of day or week to invest in cryptocurrency is just one of several aspects that traders must consider before parting with their money. To be completely truthful, the “best time to trade crypto” should be a low-priority deliberation for new, long-term crypto investors. However, active traders will definitely want to aim for certain time periods to maximize their profit margins.