CCData, a global leader in digital asset data, has once again provided invaluable insights into the cryptocurrency exchange market with the January 2024 edition of its highly popular Exchange Review report. This monthly analysis offers a deep dive into exchange volumes, crypto derivatives trading, market segmentation, and the dynamics between crypto-to-crypto versus fiat-to-crypto volumes, among other key developments.

The start of 2024 has brought with it a slight decline in the combined spot and derivatives trading volume on centralized exchanges, marking the first decrease in four months. The total trading volume dipped by 0.72% to $4.65 trillion. This reduction follows a period of heightened trading activity triggered by a sell-off and the deleveraging of positions by traders, coinciding with the range lows of crypto assets after the U.S. approval of spot Bitcoin ETFs.

Contrary to the overall decline, January saw a 4.45% increase in spot trading volumes on centralized exchanges, reaching $1.40 trillion.

This marks the fourth consecutive month of rising monthly spot trading volumes, a trend seemingly sparked by the approval of spot Bitcoin ETFs in the U.S. Binance maintained its position as the largest spot trading exchange, with volumes rising by 2.73% to $437 billion, capturing a market share of 31.3%. Meanwhile, OKX and Coinbase saw mixed fortunes, with OKX experiencing a decrease in trading volumes and market share, and Coinbase witnessing a rise in market share for the third consecutive month.

The derivatives trading volume witnessed a 2.79% decline to $3.25 trillion, alongside a decrease in market share for the fourth consecutive month, settling at 69.9%. This shift suggests a move by traders to deleverage their positions following the ETF narrative’s conclusion. Binance continued to lead the derivatives market, although it, along with OKX and Bybit, saw a decrease in trading volumes. In contrast, CME and Kraken experienced significant increases in their trading volumes.

Notably, the total derivatives trading volume on the CME surged by 35.2% to $94.9 billion, the highest since October 2021. This increase was driven largely by institutional traders winding down their positions post the approval of spot Bitcoin ETFs in the U.S. However, the open interest of BTC futures on the CME, which had recently surpassed that on Binance, saw a reversal, decreasing by 8.50%.

Following the focus on Bitcoin, attention briefly shifted towards Ethereum, particularly in anticipation of a possible ETH ETF approval. The trading volume for ETH futures on the CME rose by 15.6%, with ETH options trading volume also seeing a significant increase. This shift underscores the market’s responsiveness to regulatory developments and the potential for new investment vehicles.