Markets
Crypto: trading volumes plummet
4h30 ▪ 3 min reading ▪ by Fenelon L.
April 2024 will go down in history as a dark month for the crypto market. Trading volumes recorded their lowest level in seven months, pressured by a combination of unfavorable geopolitical and macroeconomic factors. Even the giant Binance was not spared by this bearish wave.
A sudden contraction in crypto market activity
The month of April saw a sharp drop in trading volumes on the crypto markets. According to the report from CCData, a London-based digital asset data provider, the total volume of spot and derivatives transactions fell 43.8% to reach $6.58 billion, the lowest level in seven months.
This decrease contrasts sharply with the record $9.12 billion recorded in March. The futures and options markets also suffered, with a 47.6% decrease in activity, to $4.57 billion. Spot market volume contracted 32.6% to $2.01 trillion.
O report CCData identifies several factors that contributed to this slowdown: disappointing macroeconomic indicators, escalating geopolitical tensions in the Middle East and negative flows from US ETFs linked to bitcoin. In this context, the main cryptoactives canceled the gains made in March.
Bitcoin and Binance under pressure
Bitcoin, the benchmark crypto asset, lost 15% in April, falling below the psychological threshold of $60,000 and ending a seven-month bull streak. This correction results from a combination of factors: a overheated bull marketrenewed geopolitical tensions, a reduced likelihood of the Fed quickly easing its monetary policy and a strengthening dollar.
Furthermore, among exchange platforms, Binance, the undisputed leader in the sector, saw its global market share in the spot and derivatives segments decrease to 41.5%. Trading volume on its spot market declined 39.2% to $679 billion in April, the first time since September 2023.
CCData links this decline to the sentencing of Binance founder and former CEO Changpeng Zhao to four months in prison for violating US anti-money laundering laws. However, under the direction of Ricardo Tengits successor, Binance’s spot market share rose from 30.8% to 33.8%.
In conclusion, the cryptographic market is going through a phase of turbulence, buffeted by opposing geopolitical and macroeconomic winds. In that climate of uncertainty, investors should exercise great caution. The long-awaited recovery will therefore depend on the evolution of the global situation and the industry’s ability to restore the confidence of market participants.
“””
Maximize your Cointribune experience with our ‘Read to Win’ program! Earn points for each article read and gain access to exclusive rewards. Register now and start accumulating benefits.
Click here to join ‘Read to Earn’ and turn your crypto passion into rewards!
Fenelon L.
Passionate about Bitcoin, I am exploring the paths of blockchain and cryptocurrencies and sharing them with the community. My joy is living in a world where private life and financial freedom are guarantees for everyone, and I am convinced that Bitcoin is the tool that can make this possible.
DISCLAIMER
The views, thoughts and opinions expressed in this article belong solely to the author and should not be considered investment advice. Do your own research before making any investment decisions.