Bitcoin
Trading on cryptocurrency exchanges fell for the first time in seven months
(Bloomberg) — Trading volume on major cryptocurrency exchanges fell in April for a seven-month period as market benchmark Bitcoin retreated from a record high.
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Spot trading volume on so-called centralized exchanges such as Coinbase Global, Binance and Kraken fell 32.6% to $2 trillion last month, according to data from researcher CCData. Derivatives trading volume also declined for the first time in seven months, falling 26.1% to $4.57 trillion.
While trading volume soared at the start of the year with the introduction of US exchange-traded funds investing in Bitcoin, it has slowed amid tightening financial conditions in the US, where the Federal Reserve faces the challenge of overcoming sticky inflation. Bitcoin’s halving on April 19 – when the supply of new coins minted on the network halved – was a catalyst for market excitement beforehand.
“Consistent with patterns observed over the past two cycles, trading activity on centralized exchanges typically slows in the two months following the Bitcoin halving event,” said Jacob Joseph, research analyst at CCData. “Furthermore, higher-than-expected CPI inflation data and the escalation of geopolitical tension in the Middle East brought some uncertainty and fear to the market. This coincides with negative net flows from spot Bitcoin ETFs, driving the price of major crypto assets to their lows.”
As volumes fell, the spot market share of the world’s largest crypto exchange, Binance, fell for the first time since September 2023. Share fell almost 4% to 33.8% – the lowest market share in cash to the stock exchange since January, according to CCData.
CME Group also saw its first decline in crypto trading volume in seven months. In April, its derivatives trading volume fell nearly 20% to $124 billion, according to CCData.
“Despite this, although trading activity on centralized exchanges has slowed compared to its peak in March, it remains at a high level compared to volumes recorded in other months,” said Joseph.
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