In May, the monthly trading volumes on centralized exchanges experienced a further decline, reflecting the increasing regulatory scrutiny within the industry.
Amidst increasing regulatory pressure from US regulators and lawmakers, trading volumes on centralized exchanges have reached their lowest levels in over four years.
As per a report released on June 7 by crypto analytics firm CCData, the combined trading volume of spot and derivatives in May witnessed a decline of 15.7% compared to the previous month. This marks the second consecutive month of diminishing crypto trading activity.
Since the data provided only covers the period until the end of May, it does not consider the potential consequences of the recent lawsuits filed by the SEC against Coinbase or Binance.
According to CCData, among the prominent firms experiencing a decrease in trading volumes, Binance witnessed the most significant impact.
In the month of May, Binance experienced a further decline in its overall market share, dropping to 43% from its peak of 57% in February. This decline marked the third consecutive month of decreasing market share for Binance.
According to the report, the majority of this decline in trading volumes can be attributed to Binance's decision to discontinue zero-fee trading for USDT pairs. However, it also acknowledged that the exchange was undoubtedly facing increased pressure from regulatory authorities in the United States, which could have contributed to the overall decline.
During the period of March to May, as Binance experienced a decline in market share, the biggest beneficiaries were Bullish, Bybit, and BitMEX, each of which saw a modest increase of slightly over 1% in their respective market shares.
On June 5, Binance and its CEO, Changpeng Zhao, were sued by the SEC for allegations of operating as an unregistered securities exchange and offering unregistered securities. This legal action led to a significant impact, with Binance experiencing net outflows exceeding $778 million within 24 hours. However, the company has reassured the public that their assets are secure.
In the subsequent 48 hours, the median trading volume across the three leading decentralized exchanges (DEX) witnessed a substantial surge of 444%.
Despite a decline in overall trading volumes, primarily attributed to spot trading, the market share of derivatives trading on centralized exchanges has witnessed growth, reaching a new record.
Based on the report, the derivatives market on centralized exchanges currently holds a 79.5% share of the entire cryptocurrency market, which marks a 1.2% increase from the 78.3% recorded in April. However, despite this rise in market share, the total volumes of derivatives trading experienced a decrease of 14.4% in May.
Earlier there was news that the CEO of Coinbase is announcing the release of a biopic.
