The cryptocurrency market has achieved a significant milestone as the monthly spot trading volume on crypto exchanges exceeded $1 trillion in December 2023. This marks the first time in over a year that such a substantial volume level has been surpassed. With the total exchange volume for the month reaching an astonishing $1.1 trillion, the crypto industry is experiencing renewed strength and growth.
Historical context
In September 2022, the last instance of monthly spot trading volume surpassing the $1 trillion mark was recorded. However, the market witnessed a surge in trading volume in May 2022 when it peaked at an all-time high of $1.35 trillion, setting a previous record. The recent figures for December 2023 not only represent a notable resurgence but also set a new monthly record, highlighting the remarkable growth the market has experienced.
December 2023 figures
In December 2023, the total spot trading volume on crypto exchanges reached an impressive $1.1 trillion. This figure underscores the growing interest and participation of traders and investors in the crypto market. The surge in volume is a testament to the increasing adoption of cryptocurrencies and their growing prominence in mainstream finance.
Dominant cryptocurrency exchanges
As has become customary, Binance emerged as the exchange responsible for the majority of trading volume in December 2023, contributing 39.3% of the total volume. In US dollar terms, Binance’s share of the trading volume equaled a staggering $432.7 billion. Despite facing heightened regulatory scrutiny, Binance remains a dominant force within the industry.
Other prominent exchanges
Securing the second position in December’s trading volume rankings was the South Korea-based crypto exchange Upbit, accounting for 8.3% of the total volume, equating to $91.8 billion. Right behind Upbit was OKX, capturing an 8% share of the market volume, totaling $87.5 billion. Both Upbit and OKX have experienced an increase in their market share, signaling their growing influence in the crypto exchange landscape.
Changing landscape
While Binance has long dominated the rankings as the largest spot crypto exchange by trading volume, its market share has been affected by heightened regulatory scrutiny. The evolving regulatory landscape has forced Binance to adapt, resulting in a decline in its market share. Conversely, Upbit and OKX have seen their market share increase, establishing themselves as significant contenders in the crypto exchange market.
Anticipation of Bitcoin ETF approval
The surge in trading activity in December 2023 is closely tied to the heightened anticipation surrounding the potential approval of a spot Bitcoin exchange-traded fund (ETF) by the US Securities and Exchange Commission (SEC). Speculation suggests that the SEC could grant approval to a Bitcoin ETF as early as January 10th. If approved, the Bitcoin ETF would likely further catalyze trading volume and attract new institutional investors to the crypto market.
The cryptocurrency market’s achievement of monthly spot trading volume surpassing $1 trillion in December 2023 is a clear indication of the industry’s resilience and continued growth. Binance’s declining market share highlights the impact of regulatory scrutiny on exchanges, while Upbit and OKX have emerged as formidable contenders in the market. With the potential approval of a Bitcoin ETF on the horizon, the crypto market is poised for further expansion and increased mainstream adoption. As regulatory frameworks continue to evolve, the dynamics of the crypto exchange market will undoubtedly witness further transformation.