Crypto Exchanges Grapple with Lowest Trading Volumes Since 2020
The latest data from Kaiko reveals that the trading volume of cryptocurrencies on exchanges has reached its lowest point since October 2020.
Analysts point to the banking crisis and a regulatory environment in the United States that is perceived as unfavorable as the main factors behind this decline.
According to Kaiko’s data, which tracks 18 centralized crypto exchanges, daily crypto trading volumes have plummeted to $5 billion, the lowest levels seen since 2020. The recent crackdowns and regulatory uncertainty from the US Securities and Exchange Commission (SEC) are considered significant drivers of this decline.
The trading volume on crypto exchanges refers to the total value of digital assets being bought and sold, serving as a standard measure to evaluate an exchange’s size and popularity.
In both cases, there has been a general downward trend throughout the year. Analysts generally attribute this decline to regulatory actions in the US. However, there is no consensus on this matter.
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Experts suggest that the banking crisis of this year may also be contributing to the situation. It is observed that trading volumes are performing well in the Middle East and Asia while lagging behind in the US and Canada. US exchanges seem to face challenges in accessing necessary banking services due to increased regulatory scrutiny and the absence of clear regulations.
The uncertainty surrounding regulations, the economy, and access to funding through banks is driving major players to explore offshore opportunities, particularly in international crypto hubs such as the UAE and Hong Kong. This may explain the thriving trading volumes in Asia.
The hostile regulatory environment in the US is seen as a contributing factor by industry insiders.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
