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In April, the cryptocurrency market experienced a significant crypto market cooling, marking the first decline in trading volume in seven months. Cumulative volume in spot and derivatives markets fell 43.8% to $6.58 trillion, a significant decline from the record high of $9.12 trillion seen in March, according to data from London-based digital asset data provider CCData.
The decline was especially evident in the derivatives market, where futures and options transactions contracted by 47.6% to $4.57 trillion. By comparison, spot market volume fell a relatively smaller 32.6% to $2.01 trillion.
Several factors contributed to this decline, including unexpected macroeconomic data, rising geopolitical tensions in the Middle East, and reduced inflows into U.S.-listed spot Bitcoin ETFs. As a result, major crypto assets have retraced the gains made in March.
Leading cryptocurrency Bitcoin (BTC) experienced a significant correction of nearly 15% to fall below $60,000, breaking a streak of seven consecutive months of gains. This selling wave coincided with increased risk aversion triggered by geopolitical uncertainties, reduced expectations for rapid interest rate cuts by the Fed, and the strengthening of the dollar index.
The total spot and derivative market share of Binance, the largest cryptocurrency exchange in terms of volume, dropped to 41.5%. Binance’s spot market trading volume experienced its first decline since September 2023, falling 39.2% to $679 billion in April. This drop coincided with news that Binance founder Changpeng Zhao was sentenced to four months in prison for violating US money laundering laws.
Since Zhao’s departure and Richard Teng’s appointment as CEO, Binance’s spot market share has increased slightly from 30.8% to 33.8%, according to CCData.
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