Total spot trading volumes on global crypto exchanges crashed 30.2% sequentially to $1.81 trillion last month amid a continued declining trend in cryptocurrencies, according to a report by digital asset data provider CryptoCompare. Total spot volumes touched their lowest level since December 2020 at $1.17 trillion. Spot volumes have been falling from a peak of $3.2 trillion in November 2021.
Crypto market continues to remain bearish.
Over the past few months, crypto assets have remained depressed in direct response to the US Federal Reserve’s intentions to hike interest rates amid concerns over rising inflation. In January, prices of top cryptocurrencies Bitcoin and Ethereum closed at $38,495 and $2,689, down 16.7% and 26.8% since December, respectively. Interestingly, in January, the derivative markets saw increased activity despite the market downtrend, suggesting increased hedging and speculation from market participants as they shift to trading futures and options. In January, derivatives market volumes remained steady at $2.86 trillion, while spot volumes declined significantly.
Derivative markets reached an all-time high market share of 61.2%.
The derivative markets reached an all-time high market share of 61.2%, breaking the previous all-time high of 57.3% in November 2020. “Having said this, derivative market volumes remain notably below the all-time highs reached in May 2021, when volumes reached $4.96 trillion,” CryptoCompare said in a report. Further, analysis of the trading data showed that top-tier spot volumes fell 21.2% to $1.6 trillion in January, and lower-tier spot volumes decreased 66.3% to $175 billion. Top-tier exchanges now represent 90.3% of total spot volume.
Binance was the largest top-tier spot exchange by volume in January, trading $504 billion (down 23.0%). OKX came at second trading $131 billion (down 26.4%) and Coinbase trading $120 billion (down 12.1%).
