In recent months, trading volume on centralized exchanges has seen a significant decline, with June marking the third consecutive month of diminishing activity since March. According to a report by CCData, the combined spot and derivatives trading volume across these platforms amounted to $4.2 trillion, down from a peak of $9 trillion recorded in March. One of the major factors contributing to this decline is a notable decrease in open interest in derivatives exchanges.
The futures market on the Chicago Mercantile Exchange (CME) also saw a significant decline, with trading volume falling by 11.5% to $103 billion in June. This reflects decreased interest in futures contracts for major cryptocurrencies like Bitcoin and Ethereum. Bitcoin futures trading volume declined by 11.5%, while Ethereum futures fell by 15.8%. The approval of spot Ethereum ETFs in May caused a frenzy in trading activity, which eventually decreased in June.
Shift in Market Share
Over the past six months, some exchanges have seen changes in their market share. Dubai-based exchange Bybit increased its market share by 2.01% to 8%, while Singapore-based BitGet and HTX saw gains of 1.74% and 1.43%, respectively. On the other hand, Binance saw its market share decline from 40.4% in July 2023 to 31.2% in June 2024, marking a decrease of 9.16%.
BTC options trading volume declined by 28.2% to $1.50 billion, while ETH options trading volume experienced the largest decline, plummeting by 58.0% to $408 million. This decline was primarily attributed to increased activity in options trading, driven by the SEC’s approval of spot Ether ETFs in May, and coincides with the anticipated launch of eight spot Ether ETFs expected on July 23.
Meanwhile, average funding rates across the four analyzed exchanges stabilized somewhat, rebounding from the negative rates observed in the previous month. This stabilization could be a sign of a potential shift in market sentiment towards a more positive outlook.
The decline in trading volume on centralized exchanges is a multifaceted issue with various contributing factors. From a decrease in open interest in derivatives exchanges to a shift in market share among different platforms, the landscape of cryptocurrency trading is evolving. It will be interesting to see how these trends continue to play out in the coming months and what changes may occur in response to the current market conditions.
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