By Centralized cryptocurrency exchanges (CEXs) like Binance experienced a large surge in trading volumes between October 2023 and March 2024, according to Bybit’s 2024 Institutional Industry Report released on April 18.
However, the CEX growth hasn’t surpassed the even more rapid expansion of decentralized exchanges (DEXs). Leading DEX Uniswap v3, for instance, saw a 320% increase in volumes during the same period, as highlighted in Bybit’s data.
Bybit and Treehouse Release 2024 Institutional Industry Report on Crypto Adoption
Bybit joined forces with research institute Treehouse on the crypto industry institutional report.
The comprehensive report offers insights into the current state of global CEX trading volumes and crypto adoption and compares it to traditional finance (TradFi).
Exciting news! We are proud to announce that Bybit Institutional has collaborated with @TreehouseFi for this in-depth analysis of the Q1 performance of $BTC and $ETH!
Check out the full report below #LearnWithBybithttps://t.co/RaqM4wyBYC pic.twitter.com/N7jrXOTcL8
— Bybit_Learn (@Bybit_Learn) April 18, 2024
The October 2023 to March 2024 trading volume increase saw the crypto industry’s market cap soaring from slightly above $1 trillion to over $2.5 trillion by the end of March, highlighting increasing investor confidence and substantial capital inflows.
According to the report, several CEXs experienced major growth in monthly trading volumes during this period.
Notably, OKX saw a 278% increase in 30-day volumes since October, followed closely by Binance, which saw a 239% surge. Bybit exchange also demonstrated impressive growth, adding 264% to its trading volumes during the same period.
These exchanges have outpaced the industry’s average growth rate of 255%, as confirmed by a spokesperson for Bybit. The U.S.-based exchange Coinbase also witnessed growth, albeit slightly trailing behind with a 193% increase in trading volume.
The report attributes the growth in to several factors, including Bitcoin’s price rallies, particularly following the approval of spot Bitcoin exchange-traded funds (ETFs) in the U.S.
Bybit utilized 30-day volume comparisons between October 2023 and March 2024 to mitigate daily volume fluctuations and showcase volume growth and market share changes among CEXs.
Despite OKX surpassing Binance in growth speed over the analyzed period, Binance remains the largest cryptocurrency exchange, accounting for at least 58% of the total spot trading volume, according to Bybit’s data.
Bybit is the second-largest exchange by market share, representing 9.6% of the market as of March 2023, while rival OKX comprises approximately 9% of total crypto trading volume.
In the derivatives market, CEXs have also seen a slight uptick in 30-day trading volumes, with Binance, OKX, and Bybit dominating the segment. Binance, as the largest player, increased its derivatives volumes by approximately 66% over the period.
Impending Bitcoin Halving Expected to Reduce Exchange Supply Dramatically: Bybit Report
The report also shed light on Bitcoin’s current supply dynamics, revealing that the impending Bitcoin halving event could significantly reduce the digital currency’s available supply on exchanges.
Between ETF inflows and the upcoming halving, Bybit says exchanges may soon run out of Bitcoin to sell. Here’s what you need to know.#BTC #Halving #Minershttps://t.co/6EZqNpA3YL
— Cryptonews.com (@cryptonews) April 16, 2024
According to the report, the upcoming Bitcoin halving, which will reduce the supply of new Bitcoins by 50%, will lead to a notable depletion of Bitcoin reserves on centralized exchanges.
The report highlights that with only 2 million Bitcoins left on exchanges and assuming a daily inflow of $500 million to Bitcoin Spot ETFs, approximately 7,142 Bitcoins are expected to leave exchange reserves daily. This trend suggests that exhausting all remaining reserves could take as little as nine months.
Additionally, the report emphasizes that Bitcoin will become twice as rare as gold post-halving, as indicated by the Stock-to-Flow (S2F) ratio. The S2F ratio, calculated by dividing the circulating supply of a commodity by its annual production, measures scarcity.
Bitcoin’s S2F ratio was around 56 before the halving, while gold’s was 60. However, Bitcoin’s S2F ratio is projected to double to 112 after the halving in April 2024.
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