Markets
Crypto trading volume falls for first time in seven months in April – report
MicroStockHub
Spot trading volume on centralized cryptocurrency exchanges (CEXs) cooled for the first time in seven months in April, according to data from researcher CCData, as digital asset prices suffered from a decreasing likelihood of rapid interest rate cuts this year by the Federal Reserve, in addition to slower inflows into US-listed spot bitcoin (BTC-USD) exchange-traded funds.
Specifically, spot market volume on CEXs, such as Coinbase (NASDAQ:PIECE OF MONEY), Binance and Kraken, fell 32.6% to $2.01 billion last month, according to the report. Similarly, monthly derivatives trading volume saw its first decline in three months, falling 24.1% to $4.57 billion. CEX’s combined spot and derivatives trading volume fell 26.9% to $6.58 billion.
“This decline follows unexpected macroeconomic data, an escalation of the geopolitical crisis in the Middle East and negative net flows from US spot Bitcoin ETFs, leading major crypto assets to retrace the gains they made in March,” CCData explained.
Certainly, Bitcoin (BTC-USD), the most hyped digital token, slipped nearly 15% last month to below $60,000, snapping a seven-month winning streak. This decline follows BTC’s strong multi-month rally, reaching an all-time high of over $73,000 in mid-March. At the time, this overheated uptrend was primarily fueled by speculation around the recently approved spot ETFs and the Bitcoin halving, as well as the prospects of rate cuts. Note that crypto trading activity also hit an all-time high in March.
Binance, which has been plagued by increased regulatory scrutiny, remained the largest crypto exchange by volume, according to the report. Its combined spot and derivatives market share fell 2.41% to 41.5%, marking the first decline in three months. Trading volume in the spot market alone fell 39.2% to $679 billion.
“Binance’s decline in market share also coincided with the announcement that its founder and former CEO, Changpeng Zhao, was sentenced to four months in prison for violating U.S. money laundering laws,” CCData said.
As retail investor appetite for digital assets cooled significantly last month, Robinhood Markets (NASDAQ:HOOD) notional crypto trading volumes plunged 57% M/M to $10.1 billion, it said in an operating report released Wednesday. However, this represents an increase of 173% compared to last year. Earlier this month, Robinhood delivered First quarter profit and turnover this exceeded Wall Street’s expectations, due to the sharp increase in cryptocurrency trading during the first three months of 2024.
The CME (NASDAQ:FMC) the exchange also saw a decline in derivatives trading volume in April, falling 19.8% to $124 billion, according to CCData. This is the first decline in seven months. Monthly trading volume for Bitcoin (BTC-USD) exchange futures fell 17.7% to $101 billion, while ether (ETH-USD) futures volume fell 25.9% to $14.9 billion. The overall decline in activity was accompanied by “the successful Bitcoin halving event, an important catalyst for institutional traders,” the company noted.