by U.S. regulators and the flurry of spot ETF applications injected much-needed volatility into the markets.by digital assets data provider CCData, spot trading volume on CEXs rose 16.4% to $575 billion in June, recording the first increase in three months. While the “Top-Tier” volumes increased by 12.5%, the “Lower-Tier” exchanges saw a jump of 26.4% from the previous month in May.
To the uninitiated, CCData’s Exchange Benchmark categorizes the digital asset exchange industry as “Top-Tier” or “Lower-Tier” based on the level of risk involved.The comparatively lower growth rate for Top-tier exchanges was possibly due to the legal challenges, as highlighted earlier. Binance, its American arm Binance.US and Coinbase all witnessed a decline in their market share in June. Binance, the world’s largest exchange by spot volume, was the biggest loser among CEXs.
Moreover, BTC supply on Coinbase shot up following the jump in the asset’s price, as per CryptoQuant. As Coinbase is primarily used in the American market, it could be inferred that overall spot trading activity was driven by the U.S. institutional investors.The dominance of spot trading activity affected the share of derivatives market. Although the derivative volumes increased 13.6% to $2.13 trillion in June, the overall dominance fell to 78.7%.
Interestingly, this was the first drop in derivatives market share in four months, indicative of a spot accumulation of crypto assets. It should be noted that spot ETFs, unlike futures ETFs, will be backed by real Bitcoin, and the price of one share on the exchange will react to the spot price of BTC, akin to holding a BTC.While crypto volumes were clearly invigorated in June, the supply of top digital assets on CEXs continued to dwindle. According to Glassnode, BTC’s percent supply on exchanges plunged to a five-year low of 11.6% as of 6 July.