The recent blockchain analytics report by Nansen sheds light on significant changes in the crypto market that have made post-collapse of major player FTX. As trading volumes continue to decline for most centralized exchanges (CEXs), smaller contenders have emerged as beneficiary of this highly volatile situation. Among them are Kraken, Bybit, and Bitget, which have experienced a surge in trading volumes and managed to withstand the impact that sent shockwaves across the landscape of digital currency trading platforms.
The report indicates that while established exchanges suffered considerable losses, UAE-based Bybit and US-based Kraken mounted a successful countercurrent effort, recording growth in their average monthly trading volume by 7.65% and 14.35% for the six months following the FTX downfall. Bitget, a preferred platform for Chinese and South Korean crypto aficionados, also exhibited resilience, with a relatively modest 7.29% decline in trading volumes during the same period.
Despite the meteoric rise of these smaller exchanges, Binance continues to tower over others as the world’s largest exchange by volume, although it did experience reduced market share following regulatory crackdowns.
Interestingly, as centralized exchanges stumbled, their decentralized counterparts (DEXs) remained unscathed. Nansen’s report suggests that their trading volumes have maintained an air of stability. This stability may be attributed to diminished trust in centralized exchanges, compounded by growing regulatory uncertainties surrounding the future of digital currencies.
Post-FTX collapse, there is also a notable shift towards greater transparency within the crypto industry. To regain public confidence and ensure long-term market stability, various leading exchanges have published proof-of-reserve statements. While such statements do not inherently guarantee solvency, Nansen emphasizes their role as a new “minimum standard” that one may anticipate from digital currency trading platforms.
It remains to be seen whether the recent developments serve as a turning point for the blockchain industry or a blip in the ever-expanding ecosystem of digital assets. The performance of smaller exchanges in this new and fluid landscape demonstrates that adaptability and transparency are key in surviving and thriving.
While skeptics may question the lasting impact of the up-and-coming exchanges, the crypto realm has always prided itself on its innovative and disruptive nature. With newly surfacing regulatory pressures, these smaller exchanges have an opportunity to become central players within the industry and expand their respective clienteles. They may also impact the way other exchanges approach the necessary balance between risk management and market dominance. However, it is crucial not to underestimate the importance of transparency as markets continue to evolve amid recent global setbacks.
Source: Cryptonews
