Cryptocurrency trading volumes dropped significantly in June according to data from Cryptocompare, a price and volume monitoring organization. Trading volumes fell by at least 40% month-over-month, with spot and derivative trading suffering, among other factors, from the mining and trade crackdown in China. The resulting volatility appears to have caused many traders to lose interest.
Trading volumes continued to decline in June
Cryptocurrency trading volumes fell sharply in June, according to data from Cryptocompare. Data collected by the price and volume monitoring organization shows that trading, in general, has plummeted by at least 40%. Spot volumes suffered the most, with users trading 42,7% lower than their May volumes. In total, $ 2,7 trillion was traded last month.
Derivatives trading also fell sharply. Trading fell 40,7% on a monthly basis to $ 3,2 trillion. Analysts say this drop has to do with a key reason: China's crackdown on cryptocurrency mining and trading last month. This caused cryptocurrency traders to be wary of the future of the market and accelerated the collapse in volume. Cryptocompare stated:
“Headwinds continued as China continued to crack down on bitcoin mining. As a result of both lower prices and volatility, spot volumes have decreased ”.
Internet traffic to exchanges also decreased
As a result, Internet traffic to exchanges also dropped dramatically. Exchanges received 369,1 million hits in June, a 42,2% drop month-over-month, according to research by The Block. Although Binance experienced a sharper 56% drop in trading volume, it managed to hold the top spot in spot trading volumes.
There may be other reasons why customers are avoiding Binance right now. Several organizations have blocked payments to the exchange since last week. Additionally, the exchange has met with opposition for failing to comply with local laws in several countries since last month.
But perhaps the most likely catalyst for this fall is the drop in bitcoin prices hitting the cryptocurrency market. Bitcoin hit $ 60 or more in April and is now trading in the $ 30- $ 35 range. This deterred swing traders and cooled the cryptocurrency craze that was in full effect earlier this year.
Some analysts believe this decline will continue for the foreseeable future. Scott Minerd, CIO of Guggenheim Partners, said bitcoin's "real bottom" could be around $ 10.000 last week. At the time of writing, bitcoin is trading just under $ 32 (quotation BTC).
What do you think of the drop in trading volumes in June? Let us know in the comments section below.
