Tuesday, October 3, 2023

Major exchanges monopolize cryptocurrency liquidity

  • Liquidity in the cryptographic world is concentrated in the main platforms.
  • Binance has seen growth, increasing its volume from 38.3% to 64.3% since 2021.
  • Despite the benefits of concentrating liquidity, the crypto industry is primarily about decentralization.

The ever-evolving cryptocurrency universe is facing a trend that challenges idealized views of decentralization: concentration of liquidity. The latest figures suggest a significant change in the distribution of liquidity on major exchange platforms.

Binance has been leading the cryptocurrency market for years. However, its rapid growth has attracted attention recently. According to a report by research firm Kaiko,

Major Exchanges Monopolize Cryptocurrency Liquidity

Decentralization or concentration?

The essence of cryptocurrencies lies in decentralization. However, Kaiko makes an important point:

This observation is important, because it shows a visible difference between Industry values ​​and market realities.

Regulatory policies, especially in the United States, have a significant impact on altcoin liquidity. Kaiko pointed out that it was Liquidity suffered and was heavily concentrated in the three main exchanges: Coinbase, Kraken and Bitstamp. In addition, they added:

Major Exchanges Monopolize Cryptocurrency Liquidity

The numbers show an undeniable fact: liquidity in the crypto world is increasingly concentrated on a few leading platforms. While this trend may be beneficial for some investors looking for stability, it also raises questions about the future of decentralization in the crypto ecosystem.

Nation World News Desk
Nation World News Deskhttps://nationworldnews.com/
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