Crypto Spot Volumes on Centralized Exchanges Hit Lowest Since March 2019

The volume of cryptocurrency spot trading on centralized exchanges (CEXs) plunged by 21.8% in May to $495 billion, marking the lowest monthly trading volume since March 2019. Also, derivatives trading volumes slumped by 15.7% to $1.95 trillion, which is the lowest since December 2022.

Crypto Derivatives Market Share Hits Peak

These figures are according to new data by digital asset data provider, CCData, previously known as CryptoCompare. CCData is also a benchmark administrator authorized by the UK Financial Conduct Authority.

According to the firm, despite the decrease in derivatives trading volumes on CEXs, the market share of the segment reached an all-time-high last month, expanding to 79.8%. However, the volume of spot and derivatives trading combined slid by 15.7% to $2.41 trillion.

CCData explained that the volume represents the second consecutive drop in monthly volume of the combined activities. The decrease came as the prices of digital assets fluctuated within a relatively narrow range during the period.

“The popularity of meme coins traded on decentralized venues has also contributed to the declining trading activity on centralized exchanges,” CCData added.

Binance Shrinks, CME Grows

Giving more details on the cryptocurrency trading market, CCData noted that spot trading on Binance, the world’s largest cryptocurrency exchange by trading volume, nosedived by 26% to $221 billion in May. In addition, Binance’s spot market share shrank for the third consecutive month, slipping to 43%.

The data analytics firm attributed Binance's continued weakness to the halting of zero-free trading for stablecoin USDT pairs, general weakness in the market and increased scrutiny from regulators.

Finance Magnates reported that cryptocurrency exchanges in the United States continue to face regulatory crackdown, with Binance and Coinbase sued this week by federal securities regulator for allegedly operating illegal exchanges and offering unregistered crypto asset securities.

Meanwhile, CCData’s data shows that Chicago Mercantile Exchange (CME) remained resilient in the face of plummeting volumes in the crypto derivatives industry. The top derivatives exchange posted a marginal growth of 0.53% in its derivatives volume, with total trades worth $39.1 billion.

“CME's resilience can be attributed to continued institutional interest in Bitcoin, as demonstrated by a 10.5% surge in BTC futures volume to $29.5bn,” CCData noted.

Moreover, CCData also shows that Uniswap, the biggest decentralized crypto exchange in the world, continued to outperform all CEXs, with the exception of Binance, for the fourth consecutive month. This is despite the fact that the exchange’s volume fell by 11.6% to $33 billion last month.

Uniswap functions as a non-custodial exchange that enables users to trade Ethereum blockchain-based ERC-20 tokens directly with each other without the need for a third party.

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Combined Crypto Spot and Derivative Exchange Volumes Sink to Yearly Low

The total volumes generated from spot and derivatives trading activities on centralized exchanges (CEXs) slumped by 12% to $2.36 trillion in July, hitting the lowest monthly trading volume recorded this year, so far. The figures are based on the latest exchange review report by CCData, a digital assets data provider.

Trading Suffers Lack of Volatility

Specifically, spot trading volume sank by 10.5% to $515 billion, the second-lowest volume generated since March 2019. Similarly, crypto exchanges generated the second-lowest derivatives volumes posted since December 2020. This is even as the value of trading activities went down by 12.7% to $1.85 trillion.

In June, aggregate volumes from both activities jumped by 14.2% for the first time in three months, hitting $2.71 trillion. The bullish trend came amidst a new wave of applications for spot Bitcoin exchange-traded funds by institutional investors, Finance Magnates reported.

However, volumes slowed down again in July, returning to record lows seen in the past few months. CCData attributed the decline to insufficient volatility in the crypto market.

“The decrease in trading volumes can be attributed to the lack of volatility in the price action of major crypto assets, with Bitcoin and Ethereum trading in a narrow range throughout July,” CCData explained.

Upbit Outtrades OKX and Coinbase

Meanwhile, in July, the market share of Binance continued to shrink, falling for the fifth consecutive month to 40.4%. The decline persists as the crypto exchange continues to battle regulatory opposition in several jurisdictions, particularly in the United States where federal prosecutors are now contemplating hitting the exchange with criminal charges.

However, with $208 billion in total spot trading volume, Binance remains the biggest crypto exchange in the world. In fact, the exchange Chinese users recently traded more than $90 billion in a single month, defying the ban on crypto trading in the Asian country.

On the other hand, South Korea-based crypto exchange, Upbit, pulled off an upset last month, beating top exchanges such as OKX and Coinbase to claim the position of second-largest exchange by trading volume after Binance. While Upbit’s spot trading volume surged by 42.3% to $29.8 billion in July, OKX and Coinbase saw their volumes plummet by 11.6% and 5.75% to $28.6 billion and $29 billion, respectively.

“Compared to last month, Upbit saw the largest increase in market share, with the exchange now accounting for 5.78% of the trading volumes on centralised exchanges,” CCData elaborated. “Huobi Global and Kucoin also increased their market share by trading volume, rising 1.92% and 0.47% to 3.84% and 2.21% respectively.”

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