In June, trading volume on centralized exchanges saw a significant decrease of 21.8%, marking the third consecutive month of diminishing activity. This decline was attributed to several key factors highlighted in a report by CCData. One major factor was the notable decrease in open interest on derivatives exchanges, which fell by 9.67% to $47.11 billion in June. The trend continued into July, with Coinbase experiencing a significant drop in open interest by 52.1% to $18.2 million. These declines were linked to a series of liquidations triggered by the drop in cryptocurrency prices throughout June and July. Selling pressures from various sources, including Mt. Gox repayments and Bitcoin sales by the German government, also played a role in the decline.
The futures market on the Chicago Mercantile Exchange (CME), known as the world’s largest institutional derivatives exchange, saw a notable decline in trading volume in June. After a strong performance in May, trading volume fell by 11.5% to $103 billion, indicating 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 surge in trading activity, which eventually decreased in June.
In the past six months, Dubai-based exchange Bybit increased its market share by 2.01% to 8%. Similarly, 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, a decrease of 9.16%. These shifts in market share indicate a changing landscape in the centralized exchange ecosystem.
Despite the overall decline in trading volume, average funding rates across the four analyzed exchanges stabilized somewhat, rebounding from negative rates observed in the previous month. This stabilization could indicate a more balanced market sentiment among traders and investors.
BTC options trading volume saw a decline of 28.2% to $1.50 billion, while ETH options trading volume experienced the largest drop, 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. The anticipated launch of eight spot Ether ETFs expected on July 23 could further impact options trading volume in the coming months.
Overall, the decline in trading volume on centralized exchanges reflects a shifting market landscape influenced by factors such as open interest fluctuations, selling pressures, market share shifts, and regulatory approvals. Traders and investors will need to adapt to these changes and adjust their strategies accordingly to navigate the evolving landscape of the cryptocurrency market.
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