Crypto exchange trading volumes continued their downward trajectory in June, maintaining a trend that began after March 2024. According to a report by CCData, combined trading volumes dropped for the third consecutive month, declining by 21.8% to $4.22 trillion.
The report attributed the decline to the overall sideways movement and losses for leading assets, Bitcoin (BTC) and Ethereum (ETH). “The combined trading volume fell 21.8% to $4.22tn, as major crypto assets including Bitcoin and Ethereum remained largely rangebound and recorded major drawbacks in June,” the report noted.
ETH Drops Harder Than BTC as Spot Eats into Derivatives Market
Derivatives trading volume experienced a sharper decline compared to the spot sector in June. Spot trading volume fell by 19.3% to $1.33 trillion, marking the third consecutive monthly drop from a record high of $2.94 trillion in March.
The derivatives market saw an even steeper decline. Derivatives volumes were down 22.8% to $2.89 trillion. “Derivatives volumes have also been declining relative to spot volumes, as evidenced by the declining market share of derivatives instruments. The derivatives market now represents 68.5% of the entire crypto market, compared to 70.1% in January,” the report stated.
Significant Drop in Liquidity
The decline in derivatives volumes was mirrored by a significant drop in liquidity, as tracked by open interest (OI) rates. In June, open interest on derivatives exchanges dropped by nearly 10%, with Coinbase taking the largest hit due to massive liquidations. “The open interest on derivatives exchanges declined by 9.67% to $47.11bn, following a series of liquidations triggered by a significant drop in cryptocurrency prices observed in June and continuing into July,” the report explained.
Coinbase’s OI dipped 52.1% to $18.2 million. Despite a 9.93% drop in OI for Binance, it remained the leader with $19.4 billion in open interest among centralized exchanges.
Impact on Options Volumes
June’s market drawdowns also led to a considerable decrease in options volumes that had surged in May, particularly for ETH following surprise ETH ETF partial approvals. CME data indicated a significant drop in institutional interest in ETH based on options volume. “BTC options volume on the exchange fell significantly in June, decreasing by 28.2% to $1.50bn. ETH options volume experienced an even larger decline, plummeting by 58.0% to $408mn.”
Looking Forward
Despite the current downturn, analysts have tipped the final approval and launch of ETH ETFs next week, which could potentially bolster trading volumes across both the spot and derivatives markets. However, it remains to be seen how the market will react to this development.
