Cointelegraph Team
Cointelegraph
Trading volumes on centralized exchanges have fallen to their lowest levels in more than four years amid mounting regulatory pressure from United States regulators and lawmakers.
According to a June 7 report from crypto analytics firm CCData, combined spot and derivatives trading volume in May fell 15.7% from the previous month, marking the second consecutive month of dwindling crypto trading activity.
As the data is only current to the end of May, it does not take into account any potential impact from the recent SEC lawsuits against Coinbase or Binance.
Total monthly spot trading volume on centralized exchanges since May 2022. Source: CCData
CCData shows that of all the major firms to suffer a decline in trading volumes, Binance was hit the hardest.
In May, Binance gave up even more of its total market share, falling to just 43% overall, down from its peak of 57% in February. This marked the third consecutive month that Binance’s total market share declined.
The report said this bulk of this decline can be attributed to Binance removing zero-fee trading for USDT pairs but noted the exchange was no doubt feeling the squeeze of increased scrutiny from regulators in the U.S.
Top centralized exchange market share change March thru May. Source: CCData.
The largest beneficiaries of Binance’s market share slide were crypto exchanges Bullish, Bybit and BitMEX, which each gained a little more than 1% in market share between March and May.
On June 5, the SEC sued Binance and its CEO, Changpeng Zhao, for failing to register as a securities exchange and for offering unregistered securities. Within 24 hours, the net outflows from Binance topped $778 million, though the company has assured the public that their assets remain safe.
In the 48 hours following, the median trading volume across the top three decentralized exchanges (DEX) jumped 444%.
Related: Binance.US coins trade at premium amid litigation fears, fiat gateway issues
Despite overall trading volumes waning — mostly due to spot trading — the market share of derivatives trading across centralized exchanges increased, notching a new record in the process.
According to the report, the derivatives market on centralized exchanges now represents 79.5% of the entire crypto market, a 1.2% increase from 78.3% in April. Still, total derivatives volumes decreased by 14.4% in May.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.
Recommended Content
Editors’ Picks
Celebrity meme coins controversy continues amid Pump.fun revenue dominance
Pump.fun outperformed the Ethereum blockchain on Tuesday after raking in $1.99 million. Following this achievement, a meme coin based on actress Sydney Sweeney was the subject of controversy after its developers dumped their bags on investors.
PEPE's on-chain metrics indicate potential rally after weeks of silence
PEPE has struggled to see any significant price move after reaching an all-time high in May. Increased adoption rate and low MVRV ratio indicate a bullish run may be on the horizon. A single PEPE outflow from Binance worth $14.7 million gives credence to signs of bullish expectation.
Ethereum has failed to overcome key resistance despite bullish sentiment surrounding ETH ETF
Ethereum (ETH) is down more than 1.4% on Tuesday following another ETH sale from the Ethereum Foundation. Meanwhile, crypto exchange Gemini's recent report reveals that ETH ETF could see about $5 billion in net inflows within six months of launch.
Crypto community blasts Polkadot following report of treasury spending
Polkadot reports $87 million of treasury spending during H1. Crypto community members expressed harsh feelings toward the DOT team's high spending. DOT is up more than 2% in the past 24 hours but risks correction following the report.
Bitcoin: BTC price correction could end in July, according to seasonal data
Bitcoin (BTC) price appears poised for a decline this week, influenced by slight outflows in US spot ETFs, selling activity among BTC miners, and a combined transfer of 4,690.28 BTC to centralized exchanges by the US and German governments.