Crypto Spot Trading Hits 5-Year Low Amid Market Shift
- Spot trading volume on CEXs reaches lowest level since 2020.
- Market shift towards holding noted.
- Increased DEX usage counters CEX trends.
The decline in crypto spot trading volumes on centralized exchanges affects major cryptocurrencies and reflects broader market sentiments and uncertainties.
The Shift in Crypto Spot Trading
The latest data from CryptoQuant reveals a significant drop in centralized exchange spot trading volumes, reaching levels previously seen in October 2020. This decrease underscores a shift in market behavior towards holding assets over trading.
Data provided by CryptoQuant analyst Axel Adler Jr. shows that the daily trading volumes now hover around $965.6 million. This decline is attributed to macroeconomic factors like volatile global events, affecting investor confidence across the crypto market.
The reduction in trading activity has notably impacted Bitcoin (BTC) and Ethereum (ETH), both showing decreased market movements. Analysts indicate a reactive shift towards holding strategies, as evidenced by increased holding periods amid uncertain markets.
This trend suggests a broader shift in market sentiment where investors prefer to hold assets rather than trade actively. The market’s move reflects a mix of reduced confidence and strategic long-term positioning. “The token has neither been sold on the spot nor transferred on the chain – the market has shifted towards the ‘HoDL’ model,” said Axel Adler Jr., an analyst at CryptoQuant.
Impact on Major Assets and Exchanges
Other major assets and altcoins are similarly affected, with impacts traceable across crypto exchanges globally. While centralized exchange volumes decline, decentralized exchanges (DEXs) have captured a larger share of the market, developing trends indicative of changing preferences.
Data indicates a 25% share in spot volume for DEXs by May 2025, demonstrating their growing appeal. Such shifts signify potential changes in market structures, with investors prioritizing decentralized environments over traditional centralized platforms amid ongoing macroeconomic volatility.
