CEX Trading Volume Drops 17.2%, Binance Loses Ground as Crypto.com Surges

• September saw a seasonal 17.2% drop in centralized exchange (CEX) trading volume, with lower-tier exchanges experiencing a steeper decline (20.2%).
• Trading volume is expected to pick up from October onwards, potentially driven by the Fed's rate cuts.
• Despite market share loss (2.02%), Binance remains the top CEX with a $344B spot trading volume.

CCData report reveals thatBinance market share slid to the lowest level in four years. Meanwhile, Crypto.com strengthened its position by 4.3%, reaching $134B in monthly trading volume.

September's cumulative exchange spot trading volume experienced a typical seasonal decline of 17.2%, yet the Fed's recent rate cut may fuel trading activity in October.

Let's unpack CCData report insights and what they mean for the market.

CEX Trading Volume Dips 17.2%The aggregate monthly trading volume slid by 17.2% in September, marking the first decline in three months.

Typically, the volume slowly picks up from October to February and peaks in March. Fed's 50 basis point interest rate cut may catalyze this growth by encouraging investment.

The trading volume decline is more prominent among lower-tier exchanges (20.2%), while top-tier CEXs lost 15.7%. AA-tier exchanges now account for 69.3% of the cumulative spot trading volume ($883B).

Derivatives trading volume decreased by 17%, reaching June's level. The derivatives market share is now at 70.7% of the entire crypto market, standing at $3.07T.

CEX Shakeup - Binance Slips, Crypto.com Gains GroundBinance still leads the pack with a $344B spot trading volume, comprising 38% of the total top-tier CEX trading volume.

Crypto.com ranks second with a $134B spot trading volume, a 40.2% increase since August, and ByBit is third with a $122B volume, a 19.6% drop.

OKX traded $49.8B in September, 24.7% less than in August. Crypto.com also took the lead in derivatives trading, with a 42.8% monthly increase.

Crypto.com and Upbit were the top gainers by market share, rising 4.3% and 0.53%, respectively. Binance lost 2.02% of its market share, followed by Coinbase, with a 0.68% decline.

Year-to-date, Crypto.com strengthened its market share by 8.08% and ByBit by 3.48%. Despite Upbit's monthly increase, its yearly market share change is negative (-4.6%). Binance shows a consistent market share decline pattern with a 5.34% annual drop.

The derivatives market share monthly change pattern is similar to that of spot, with Binance and Coinbase seeing the biggest decline. Crypto.com and OKX achieved the highest gains.

However, Binance isn't yet ready to step down from its throne, holding a 36.59% market dominance. Its closest rival, OKX, has a nearly three times lower market share of 14.1%. Crypto.com climbed to the fourth place with a 6.48% market dominance.

Retail Derivatives Surge on Rate Cut Hopes

Retail derivatives exchanges saw a 32.1% surge in open interest (OI) in September, reaching $53.8B. This increase was likely driven by anticipation of the Fed's rate cut, which could inject more capital into the markets.

Binance, Bitget, OKX, and Bybit all experienced significant growth in open interest during the month (28.2%, 32.0%, and 28.5%, respectively).

The average funding rate for $BTC instruments has increased by 0.51% since August, reaching 1.21%. This suggestsbullish sentiment in the market.

Closing Remarks

Despite the predictable seasonal decline, the surge in retail derivatives OI fueled by the Fed's rate cut suggests a positive outlook for the near future.

Meanwhile, CEX competition is intensifying. Crypto.com's consistent market share and volume growth indicate it's becoming a strong competitor to Binance.

Are traders diversifying their portfolios across multiple CEXs or seeking better conditions? It appears that Binance needs to rethink its approachto retain a dominant position.

References

• Exchange Review (CCData)

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