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Centralised crypto exchanges see $5.2 trillion in trading volume for May 2024

While overall trading activity dipped, the derivatives market picked up steam in May, reaching its most active point since December 2023

Shashank Bhardwaj
Published: Jun 6, 2024 04:40:17 PM IST
Updated: Jun 6, 2024 04:40:43 PM IST

Centralised crypto exchanges see .2 trillion in trading volume for May 2024Image: Getty Images

May 2024 brought a notable slowdown in cryptocurrency trading activity, impacting both spot and crypto derivatives markets. Centralised crypto exchanges experienced a 20.1% drop in combined trading volume for May, reaching $5.27 trillion. This follows a similar trend in April, suggesting a cooling-off period in the market. Analysts attribute this slowdown to Bitcoin's relatively flat price (around $70,889) since the network's halving event in April.

Spot trading volumes dipped 21.6% to $1.57 trillion, and the derivatives market also experienced a decline of 19.4%, reaching $3.69 trillion. While overall trading activity softened in May, the derivatives market saw a relative uptick, reaching its most dominant position since December 2023. This shift likely reflects investor reaction to the US Securities and Exchange Commission's surprising green light for spot Ether ETFs.

The news sparked a surge in open interest for Ether crypto derivatives, with a notable 50.3% increase to $14.0 billion. This suggests that traders increasingly utilising crypto derivatives to manage their exposure to Ether in anticipation of potential price movements following the ETF launch.

Bybit, a crypto exchange, captured a record-breaking market share of 7.36% for spot trading, even though their overall trading volume dipped 12.7% to $116 billion. This suggests that Bybit may attract new users despite the slow market downturn. Meanwhile, the industry leader, Binance, held onto its top spot with a 34.6% market share, but its trading volume declined by 19.8% to $545 billion.

Binance further solidified its lead position in the derivatives market in May, capturing a 45.4% market share with a monthly trading volume of $1.68 trillion. OKX and Bitget followed closely behind, holding onto market shares of 21.3% and 14.5%, respectively.

The US-based CME exchange saw a 7.42% dip in crypto derivatives trading to $115 billion in May.
However, there was a significant surge in Ether (ETH) futures and options, with ETH futures volumes jumping 37.5% to $20.5 billion and options trading increasing by 115% to $931 million. Analysts attribute this surge to heightened institutional interest following the SEC's approval of spot Ether ETFs, as institutions use CME's derivatives platform to manage their exposure to Ether.

Following the US approval of spot Ether ETFs, there was an initial surge in trading activity, but it was short-lived. Since the announcement, over $3 billion in Ether's position has left crypto exchanges. However, some analysts remain optimistic, anticipating that the launch of spot Ether ETFs could drive Ether's price above its November 2021 peak of $4,870 due to increased demand.

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist.
Twitter: @bhardwajshash