Crypto Trading Volumes Hit Four-Month Low Amid Macroeconomic Uncertainty
The cryptocurrency market saw a sharp decline in trading volumes last month as investor sentiment weakened due to growing concerns over global trade policies.
Crypto trading activity dropped 21% in February, bringing total spot and derivatives volume on centralized exchanges down to $7.2 trillion, the lowest since October, according to CoinDesk Data’s latest Exchange Review.
Trade Tariff Fears Weigh on Market Sentiment
Investor caution deepened following tariff threats from the Trump administration, which has been considering imposing new trade restrictions on Mexico, Canada, China, and the European Union. The prospect of escalating trade tensions dampened risk appetite, leading to reduced participation in the crypto markets.
Centralized Exchange Rankings
Despite the slowdown, Binance retained its top position as the largest spot trading exchange, holding a 27% market share. It was followed by Crypto.com (8.1%), Bybit (7.4%), with Coinbase (COIN) and MEXC Global completing the top five.
Derivatives Market Faces Significant Decline
The slump extended to derivatives trading, with CME—the largest institutional crypto trading venue—experiencing its first volume drop in five months.
- CME’s total trading volume fell 20% to $229 billion
- Bitcoin futures volume declined 20% to $175 billion
- Ether futures dropped 13% to $35.9 billion
Institutional Interest Remains Despite Retail Weakness
The decline in trading also pushed the BTC CME annualized basis to 4.08%, its lowest level since March 2023. However, CME’s market share among derivatives exchanges grew to a record 4.67%, suggesting that while retail trading activity has waned, institutional participation remains steady.
For instance, Robinhood (HOOD) recently reported a 29% decline in crypto trading volume for February, reinforcing the broader trend of reduced retail engagement.
Market Liquidations Reflect Cautious Trading Environment
Total open interest across all trading pairs on centralized exchanges fell 30% to $78.8 billion, reaching the lowest level since Nov. 5. This drop reflects the wave of liquidations triggered by the recent market drawdown, further contributing to the decline in trading activity.
As macroeconomic concerns continue to weigh on risk assets, investors remain cautious about increasing exposure to cryptocurrencies, leading to a more subdued market environment.
