Recent Decline in Crypto Exchange Volumes
The top cryptocurrency exchanges globally have witnessed a significant reduction in trading volumes in the past 24 hours. Notably, the ripple effects of America’s increasing regulatory scrutiny seem to be impacting all exchanges. This notable decline is present across the board, despite the fact that weekends are typically marked by quieter trading activity in the cryptocurrency markets.
Last week, billions of dollars left centralized exchanges in the wake of escalating regulatory actions by the U.S. Securities and Exchange Commission (SEC) and consequential lawsuits. According to data from CoinMarketCap, the trading volumes for the top nine cryptocurrency exchanges have plummeted between 30% and 55% over the past 24 hours. This decrease in volumes might be perceived positively as the recent exodus from exchanges appears to have subsided.
Impacts on Leading Exchanges
Binance, one of the world’s largest crypto exchanges, has seen its trading volume decrease by 33.4% to $5.6 billion, with BTC/USDT being the most traded pair accounting for 23.3% of the total. Additionally, Coinbase, also under SEC scrutiny, has experienced a 41% drop in 24-hour volume. Other exchanges like Kraken, Bitstamp, and Bitfinex have seen their volumes shrink by more than 50%.
Furthermore, Binance has experienced substantial outflows over the past week. Glassnode data shows that its BTC balance has decreased by 5.7%, equivalent to around $1 billion in Bitcoin, following the SEC action last week. However, these outflows are modest compared to the ones that followed the FTX collapse in November.
Assessing the Shift in Volumes
Despite the dip in volumes, it is important not to overstate these figures. Changpeng Zhao, Binance’s CEO, recently warned investors against reading too much into exchange outflow data. Many analytics platforms use the Total Value Locked (TVL) metric, which includes decreases in crypto asset prices.
For instance, DeFiLlama reported an outflow of $3.4 billion from Binance over the past week. However, considering the crypto market cap has decreased by over $80 billion during the same period, the data seems skewed.
On June 12, CoinMarketCap reported a daily volume of $26.4 billion, roughly half of the $54 billion daily trade volume recorded on June 6, during the height of market panic. This suggests that total trading volumes have returned to levels observed prior to the SEC’s recent regulatory actions.
