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Exchange activity fell to a three-year low

Cryptocurrency exchanges are seeing a marked decline in activity, reaching their lowest level since October 2020.

This period turned out to be one of the most inactive in digital asset trading in recent years. The Block.

Monthly trading volume on major cryptocurrency exchanges was about $424 billion in May. This is significantly lower than in May 2022 and May 2021, when volumes reached $1.4 trillion and $4.25 trillion, respectively.

According to analysts, the reduced interest in trading digital assets is associated with the departure of large trading companies from the market and the transition to decentralized platforms.

Another factor influencing the decline in activity is the level of volatility. Institutional trading floor LMAX noted that volatility is in a correction after hitting a yearly high in March. So, at the moment, the average daily ranges for bitcoin (BTC) and ether (ETH) are $818 and $57, respectively.

Black bar for crypto exchanges

Last week, analysts reported that the influx of key assets to crypto exchanges is at a cyclical low. In addition, this indicator reached $1.65 billion, which is the lowest since the beginning of the last bull market.

According to experts, low liquidity is exacerbated by the departure of large market makers. Earlier this month, top market makers Jane Street and Jump Crypto scaled back their trading plans in the US due to ongoing regulatory pressure in the country.

What’s going on with DEX

However, decentralized platforms (DEXs) have been experiencing explosive growth in recent months due to the popularity of memcoins. The spot DEX to CEX trading volume ratio has peaked, surpassing 20% ​​for the first time, analysts said.

What’s more, in early April, trading volume on the DEX hit a ten-month high since the collapse of the Terra ecosystem in May last year. At the same time, in March, the trading volume of decentralized platforms increased to $133.3 billion, which is 53% more than in February, when it amounted to $86.9 billion.

Source: Cryptocurrency

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