This Is Why Crypto Trading Volumes Reached a 12-Month High
Top centralized cryptocurrency exchanges, such as Binance and Coinbase, experienced a significant increase in spot trading activities in January. Experts believe that this surge can be attributed to the anticipation of spot Bitcoin ETFs (exchange-traded funds).
According to analysts at blockchain analytics firm CryptoRank, trading volumes on centralized exchanges rose by 10.4% from December 2023 to reach a 12-month high of over $800 billion in January. Remarkably, Binance accounted for $400 billion of this volume, indicating a recovery from the regulatory challenges it faced in multiple jurisdictions, including the U.S. Despite regulatory scrutiny, Binance remains the dominant trading platform with a market share of 52%.
Coinbase, the largest U.S.-based crypto trading platform, also witnessed a 20% increase in trading volume, primarily due to its crucial role in the newly launched spot Bitcoin ETFs.
Other platforms such as Upbit, Crypto.com, and Huobi saw significant growth of 44.6%, 28.4%, and 23.8% respectively. Bybit, Kraken, and OKX also experienced positive growth rates of 15.0%, 12.1%, and 5.9% respectively. KuCoin had the lowest growth rate at 3.3%. However, Gate.io reported a 34% decline in spot trading volume.
The recent surge in trading volume is part of a positive trend observed since October 2023. Market observers primarily attribute this to the heightened interest in Bitcoin ETFs. Prominent crypto analyst Al Bert highlighted the strong trading activity in January, linking it to increased user engagement and growth driven by the SEC’s ETF approval. Al Bert also pointed out that improving macroeconomic conditions, such as potential rate cuts by the Federal Reserve and easing measures announced by China and the European Central Bank, have influenced the overall market volume positively.