The trading volume of cryptocurrency derivatives saw a significant increase in March, hitting an all-time high of $6.18 trillion, which is an impressive 86.5% surge compared to previous months. Even with this remarkable growth, the ratio of crypto derivatives trading to the overall market activity has been decreasing for the sixth consecutive month, as per the data provided by London-based digital asset data provider CCData.

Spot Trading Volume Sees a 108% Rise in March

There was a substantial rise in the trading volume of crypto derivatives in March, tripling the total market value of cryptocurrencies. However, the dominance of derivatives in the market fell to its lowest level since December 2022, dropping to 67.8%.

This decline is attributed to a noticeable shift towards spot trading, where cryptocurrencies are exchanged for immediate delivery, indicating a preference among investors. Spot trading volume witnessed a noteworthy increase of 108% in March, reaching $2.94 trillion, which is the highest monthly volume reported since May 2021.

When combining derivative trading volume with spot trading volume, the total transaction volume in the crypto market spiked by 92.9%, reaching a record high of $9.12 trillion. CCData's monthly report credits this surge in spot trading activity to the excitement generated by Bitcoin reaching its all-time high and the increased individual participation in the market.

Amidst the rise in derivative trading volume, concerns arise regarding its impact on market volatility and potential association with speculative activity, especially during significant market peaks. The decrease in the percentage of derivative trading transactions as part of the total market activity might suggest a drop in speculative trading behavior, a development that could be well-received by crypto enthusiasts anticipating a continuous price increase.

Stellar Three Months for Crypto Market

As per CoinMarketCap data, the leading cryptocurrency, Bitcoin, surged by 16.6% in March, hitting a peak of $73,750. This upward trend led to a remarkable three-month performance, with Bitcoin's price skyrocketing by over 68%. Similarly, the top 20 cryptocurrencies displayed noteworthy performance, with a more than 50% value increase in the initial three months of the year.