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The majority of digital asset trading around the world is handled by just eight cryptocurrency exchanges, according to an analysis by Kaiko. 
The <a href="https://research.kaiko.com/insights/the-crypto-liquidity-concentration-report" target="_blank" rel="noopener noreferrer nofollow">study</a> revealed that only eight crypto exchanges handle 90% of the global crypto trading volume and hold as much as 92% of the market depth. 
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 🔔Introducing: The <a href="https://twitter.com/hashtag/Crypto?src=hash&amp;ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">#Crypto</a> Liquidity Concentration Report 👉 90% of liquidity is concentrated on just 8 exchanges 👉 liquidity has become more concentrated over time 👉 Binance accounts for 30% of global depth and 64% of volume Check it out:<a href="https://t.co/kInbfgGGkW" target="_blank" rel="noopener noreferrer nofollow">https://t.co/kInbfgGGkW</a>— Kaiko (@KaikoData) <a href="https://twitter.com/KaikoData/status/1700155012926595354?ref_src=twsrc%5Etfw" target="_blank" rel="noopener noreferrer nofollow">September 8, 2023</a> 
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Since the beginning of 2023, <a href="https://crypto.news/from-compliance-to-complicity-how-binances-russian-connection-undermines-sanctions-opinion/" target="_blank" rel="noopener noreferrer nofollow">Binance</a> has accounted for over 30% of the cryptocurrency market depth worldwide. It is also responsible for more than 64% of crypto trading volumes globally. 
The Changpeng Zhao-led exchange has maintained its status as the most significant player in the digital asset sector. However, per the report, its market depth has fallen nearly 12% since 2021. 
Other exchanges that hold the lion’s share of the crypto market include Coinbase, Kraken, OKX, KuCoin, <a href="https://crypto.news/bybit-trading-volumes-surge-amid-usdc-volatility/" target="_blank" rel="noopener noreferrer nofollow">Bybit</a>, Binance.US, and Bitfinex, in that order. 
 You might also like: <a href="https://crypto.news/taiwan-plans-ban-on-unregistered-offshore-crypto-exchanges/" rel="noopener noreferrer nofollow"> Taiwan plans ban on unregistered offshore crypto exchanges </a> 
The latest trading volume concentration figures are nearly 6% higher than in 2021, when the eight biggest exchanges were responsible for slightly more than 84% of global crypto trading volumes. 
According to Kaiko’s director of research, Clara Medalie, the increased concentration of liquidity in just a handful of exchanges is the result of “natural market forces” that, in her opinion, have favored the average crypto trader. 
In a note accompanying the report, Medalie cautioned that highly concentrated crypto markets could more easily create points of failure, as shown by the <a href="https://crypto.news/ftx-files-for-chapter-11-bankruptcy-taking-down-about-130-companies-with-it/" target="_blank" rel="noopener noreferrer nofollow">collapse</a> of FTX in 2022. The event caused thousands of crypto investors to leave the market after losing billions from the fall of FTX and other crypto firms such as Celsius and 3AC. 
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 Highly concentrated crypto markets are both a good and bad thing. There is undoubtedly a shortage of liquidity, which, when spread thin across many exchanges and trading pairs, can exacerbate volatility and disrupt the price discovery process. <cite>Clara Medalie, Director of Reserach, Kaiko</cite> 
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Kaiko’s report comes in the wake of the year’s biggest decline in crypto trading volume numbers in August. Per <a href="https://mondovisione.com/media-and-resources/news/ccdata-monthly-exchange-review-crypto-trading-activity-falls-to-4-month-low/" target="_blank" rel="noopener noreferrer nofollow">information</a> from CCData, the combined spot and derivative trading volumes in August fell by more than 11% to $2.09 trillion. It was the second-worst monthly total since October 2020. 
 Read more: <a href="https://crypto.news/crypto-spot-trading-volume-drops-36-in-q2-coinmarketcap-reports/" rel="noopener noreferrer nofollow"> Crypto spot trading volume drops 36% in Q2, CoinMarketCap reports </a>

Eight exchanges handle 90% of crypto trading, Kaiko data shows

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