Increasing Concentration of Crypto Liquidity in Major Exchanges, Reveals Kaiko Analytics Firm

Increasing Concentration of Crypto Liquidity in Major Exchanges, Reveals Kaiko Analytics Firm

Crypto Exchanges Concentrating Liquidity, Says Kaiko

A recent report from crypto insights firm Kaiko reveals that the world’s top crypto exchanges are dominating the industry’s trading volume. According to the data, the eight largest exchanges account for over 91% of market depth and 89% of overall volume.

Binance, the leading exchange, continues to maintain its position at the top. Since 2021, Binance’s market share of spot volume has increased from 38.3% to 64.3%, with a significant portion of this growth attributed to a zero-fee trading promotion.

Kaiko emphasizes that liquidity is heavily concentrated within a small number of exchanges. While there are hundreds of trading platforms available, most only serve niche market segments. This concentration goes against the decentralized ethos of the cryptocurrency industry.

The report also highlights the impact of anti-crypto regulations in the US, which has resulted in altcoin liquidity becoming concentrated within three major exchanges: Coinbase, Kraken, and Bitstamp.

Hot Take

Read Disclaimer
This page is simply meant to provide information. It does not constitute a direct offer to purchase or sell, a solicitation of an offer to buy or sell, or a suggestion or endorsement of any goods, services, or businesses. does not offer accounting, tax, or legal advice. When using or relying on any of the products, services, or content described in this article, neither the firm nor the author is liable, directly or indirectly, for any harm or loss that may result. Read more at Important Disclaimers and at Risk Disclaimers.

The concentration of liquidity within a few top exchanges raises concerns about the decentralization of the cryptocurrency market. While it may be beneficial for market efficiency, it goes against the principles of decentralization that the industry values. Regulatory challenges in the US further contribute to this concentration. As the industry evolves, it will be important to find a balance between liquidity concentration and decentralization to ensure a healthy and resilient crypto ecosystem.

Author – Contributor at | Website

Daisy Hodley emerges as a luminary blending the roles of crypto analyst, devoted researcher, and editorial virtuoso into a harmonious symphony. In the realm of digital currencies, Daisy’s insights resonate with an exquisite resonance across a diverse spectrum of minds. Her adeptness in decoding intricate threads of crypto complexities seamlessly intertwines with her editorial finesse, translating intricacy into a captivating melody of understanding. A guiding star for both intrepid explorers and curious novices venturing into the crypto realm, Daisy’s insights form a compass for discerning decision-making amidst the ever-shifting currents of cryptocurrencies. With the touch of a literary artist, they craft a narrative that enriches the evolving mosaic of the crypto landscape.