The volume of Crypto Derivatives Traded Drops in December as the Industry Deals with FTX Aftershocks
CryptoCompare, a blockchain market data source, released a study indicating a sharp decline in crypto derivatives trading activity last month, after the bankruptcy of industry heavyweight FTX in November.
According to CryptoCompare’s recent Exchange Review, December saw a 52.7% decrease in derivatives volumes, to $1.16 trillion.
Binance, the largest cryptocurrency exchange by market share at 62.7%, had a 50% drop in derivatives volume to $726 billion in December compared to November.
The highest daily volume for derivatives trading in December was $64.7 billion, down from a record $295 billion on November 16.
Chicago Mercantile Exchange (CME), a worldwide derivatives marketplace, saw a 49.2% drop in crypto-related trade activity in December, to $14.2 billion, the lowest level since October 2020.
Futures trading in Bitcoin (BTC) fell by 48.3 percent to $13.2 billion on the exchange. Ethereum (ETH) futures on the CME fell even more, dropping 55.3% to $481 million, the lowest value since March 2021.
With the collapse of the Bahamian-based crypto derivatives exchange FTX in November, volatility in the digital assets market has increased, leading to a sharp decline in trading volume.
Finally, in December, volumes across cryptocurrency exchanges’ derivative and spot markets dropped by 51.4%. Coinciding with this is the decline in confidence that investors have in centralized exchanges as a result of the FTX hack in November, which has caused them to tread carefully out of fear of a domino effect.