According to the latest report by CCData, in May 2024, the cryptocurrency market saw a significant decline in both spot and derivatives trading volumes.

The combined trading volume on centralized exchanges fell by 20.1% to $5.27 trillion during the month. This decline marks the second consecutive month of reduced trading activity, driven by the rangebound price of Bitcoin ( BTC ) following the network’s April halving.

Spot trading volumes on centralized exchanges dropped 21.6% to $1.57 trillion. The derivatives market also experienced a decline, with volumes decreasing by 19.4% to $3.69 trillion. Despite this downturn, the derivatives market’s dominance increased to the highest level since December 2023, as traders responded to the United States Securities and Exchange Commission’s unexpected approval of spot Ether ( ETH ) exchange-traded funds (ETFs). This led to a record high in open interest for Ether derivative instruments, which rose by 50.3% to $14.0 billion.

Centralized crypto exchange trading volume falls to $5.2T in May image 0 Source: CCData

During the month, crypto exchange Bybit achieved a new all-time high spot market share of 7.36%, despite a 12.7% drop in spot trading volume to $116 billion. Binance maintained its position as the largest spot exchange with a 34.6% market share, even as its volumes fell by 19.8% to $545 billion.

In the derivatives market, Binance’s dominance grew to 45.4%, trading $1.68 trillion in monthly volume, followed by OKX and Bitget with market shares of 21.3% and 14.5%, respectively.

At the same time, the U.S. CME exchange saw a mixed performance. While overall derivatives trading volume fell by 7.42% to $115 billion, ETH futures volumes surged by 37.5% to $20.5 billion, the highest since November 2021. ETH options trading volume also hit a new all-time high, increasing by 115% to $931 million, reflecting what researchers say are “heightened institutional interest” post-SEC approval of the spot Ethere ETF.

Although trading activity ticked up due to the surprise approval of spot Ether ETFs in the U.S., it appears that traders are reacting to the event as one of “buy the rumor, sell the news.” Since ETF approvals, crypto exchanges have seen more than  $3 billion in Ether position exits . That said, some analysts believe Ether could break its November 2021 all-time high of $4,870 once spot Ether ETFs start trading, possibly this month, due to increased demand pressure.

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