In the first half of 2023, the cryptocurrency market has seen significant shifts in exchange activities, according to a comprehensive analysis by CoinMarketCap. The report examines the overall health, size, and activity level of the crypto market, considering both centralized and decentralized exchanges.
The top 20 exchanges contributed $1.67 trillion in total spot trade volume in Q2 2023, marking a 36% drop compared to the previous quarter. This decline indicates a slowdown in market activities, following Q1’s active trading spurred by Bitcoin’s price doubling.
Binance maintained its dominant position in the market throughout H1 2023, with a total spot trading volume share of 59.99%. The top five exchanges, including Binance, Coinbase, and Kraken, accounted for approximately 85% of the total spot market volume.
The market continues to offer a healthy number of trading pairs and available coins, with a steady increase in new listings. Binance dominated liquidity in the large-cap space, focusing its new listings on high-quality mainstream coins.
BitForex and Bitget were among the most active in adding new coins during the memecoin season from April to June 2023.
Binance ($57 billion), OKX ($10 billion), and Bitfinex ($10 billion) exhibited the highest amount of Proof of Reserve Assets. Despite recent market FUD leading to capital outflows from Binance, the exchange still maintains a healthy amount of Proof of Reserve assets.
In H1 2023, the majority of exchange tokens achieved net positive returns, although most were unable to outperform Bitcoin (+182% YTD).
Decentralized exchanges (DEX) saw their peak trading volume in March, with a total DEX volume of $189 billion in Q2, a 24% decrease compared to Q1. Uniswap dominated the DEX market with a 57.5% market share, and its monthly volume has been on par with Coinbase’s spot volume.
The DEX to CEX ratio has increased to around 1:8, attributed to advancements in DEX products, regulatory concerns about CEX, lower gas fees, and a higher proportion of crypto-native participants.
Approximately 80% of the DEX trade volume occurred on Ethereum and its Layer2 chains in H1 2023. However, BNB has been rapidly gaining a larger share of the DEX trading market in Q2.