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Regulators Put the Squeeze on Crypto Trading, Volumes Plummet

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Trading volumes across major centralized cryptocurrency exchanges (CEXes) continued to contract throughout May as regulators cracked the whip in the U.S. and worldwide. In a report compiled by CCData, records show that the combined spot and derivatives trading volumes across platforms like Binance and OKX fell 15.7% to $2.41 trillion.

It represented the second month of trading volumes dropping when crypto asset prices mostly moved sideways and general volatility at early 2023 levels.

Trading Volumes Drop Double Digits in May

A notable development is that spot trading volumes dropped by 21.8% in May to $495 billion.

At this rate, trading volumes fell to levels last seen in March 2019. Meanwhile, derivatives crypto trading volumes crashed to a six-month low when they contracted 15.7% to $1.95 trillion in May.

The market share of Binance, the world’s largest crypto exchange by trading volumes, also fell to 43% in May. This development follows the announcement by the exchange that they were halting zero-fee spot trading for USDT pairs.

Still, at this level, Binance remains dominant and relatively more active than competitors like Coinbase, Kraken, and Bitfinex.

CCData notes that the general drop in Binance’s market share and trading volumes could also be attributed to general market weakness and increased scrutiny from regulators, especially in the United States.

Market weakness was visible in May as Bitcoin prices failed to break above $31,000 registered in April. Instead, Bitcoin continued to track lower, dropping to as low as $25,800 at some point in May. Prices are currently struggling below $30,000.

Bitcoin Price On June 8| Source:

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Author: Dalmas Ngetich

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