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Crypto centralized exchanges saw trading volumes drop for the first time in three months in April as digital assets cooled off after a torrid first quarter.
According to blockchain data provider Kaiko, trading volumes on centralized exchanges have fallen after three consecutive months of growth.
According to the data, April’s volume was almost half that of March, at about $500 billion. The month was the lowest this year in terms of volumes, while March was the highest.
The data provider noted that volumes reached pre-FTX levels prior to the April slump. He also noted that markets remain above 2020 levels in terms of trading volumes.
“However, overall, the crypto market remains significantly larger than it was prior to the 2020 bull market,” Kaiko said.
Trade volumes on #CEXs declined in April after rising for three consecutive months and surpassing pre-FTX levels in March.
Overall, however, the cryptocurrency market remains significantly larger than it was before the 2020 bull run.#crypto #TradeVolume #liquidity #CEX pic.twitter.com/cmftFD3Qya
— Kaiko (@KaikoData) May 3, 2023
The volume of legitimate centralized spot exchange fell 43.8% to $400.5 billion in April, according to The Block.
“Most of the decline is due to Binance adding fees for BTC pairs,” the post notes. According to the data, Binance remains the market leader with a 71.6% dominance.
In addition, according to CoinGecko, Binance’s 24-hour trading volume is around $10 billion, which is significantly more than its closest competitor Coinbase at $1.1 billion.
At the end of April, it was reported that Binance’s Bitcoin balance increased by more than 50,000 BTC, approximately $1.5 billion, in a month. The move came before a sell-off as BTC faced strong resistance just above the $30,000 level.
U.S. cryptocurrency exchange Coinbase app downloads have also declined in recent months, according to a Yahoo News report, as trading volumes in the sideways market dwindle.
Tom Grant, vice president of research at Apptopia, a research firm that tracks app usage metrics, said the decline in app usage paints a bearish picture for the company.
Related: BTC price may need to drop $24.4k as Bitcoin speculators remain in profit
The decline in CEX volume is due to digital asset markets starting to retreat from their 2023 highs in mid-April. On April 16, total market capitalization hit an 11-month high of $1.34 trillion. Since then, however, markets have fallen 7.5% to $1.24 trillion.
Since the beginning of the year, the cryptocurrency markets have risen by 50%, but they have remained mostly in a range over the past six weeks or so.
Analysts are hinting that the correction is likely to continue as markets were somewhat overheated in the first quarter of the year.