Crypto Trading Volumes Tumble 40% as Bitcoin Suffers
Crypto trading volume plunged as digital assets suffered some sort of setback due to a whirlwind of exits that knocked off Bitcoin, Ethereum and others amidst a crackdown by the Chinese government.
Pressures that faced the cryptocurrencies adoption, acceptance in the last few weeks take a toll on digital assets as trading volumes at the world’s biggest crypto exchanges crashed over 40% in June 2021.
Profit-taking activities hit cryptoassets in general, resulting in more than a $1 trillion decline in market capitalisation.
“Cryptocurrencies are not in a good way after spending the last two months navigating a comedown that’s wiped out around half the value of the world’s largest tokens, driven by international attention over the environmental effects of crypto mining and a worsening crackdown in China”, analysts said at a forum.
Last month saw Bitcoin lose over 6% through the month and fall to its lowest price since December at $28,600 on June 22, when its highest daily volume of $138.2 billion was down 42% from its May intra-month high.
Likewise, the second largest and popular Ethereum lost 15%, while meme currency Doge sank over 20% during June. However, the losses have diminished volatility, pushing down trading volumes.
The world’s major crypto exchanges – including Coinbase, Kraken, Bitstamp and Binance – saw trading volume sink by over 40% in June, according to CryptoCompare data.
The report cites China as a major catalyst, arguing that its latest efforts to crack down on the industry have had a bigger impact than ever before.
The restrictions across the country have included banning financial firms from offering crypto services to clients or customers and shuttering mining operations that accounted for up to 60% of all Bitcoin mining power.
Specifically, trading volumes in June fell 42.7% to $2.7 trillion, and derivative volumes were down 40.7% to $3.2 trillion, market data shows while analysts maintain that the Chinese crackdown has caused a lot of fear, which is showing up in markets.
“The digital asset ecosystem got punched in the face, so it’s currently up against the ropes versus fighting in the middle of the ring. Typically when you have large sell-offs, participants are quite fearful and pull back their chips”.
S&P Dow Jones Launches Broad Cryptocurrency Index
In a related development, S&P Dow Jones Indices said Tuesday it has launched the S&P Cryptocurrency Broad Digital Market (BDM) Index as part of its expansion into digital currency benchmarks.
The BDM Index includes more than 240 digital coins, while four related benchmarks will track four constituent subsets: the BDM Ex-MegaCap Index excluding Bitcoin and Ethereum, a large-cap index, a large-cap index excluding the megacaps, and an index excluding the large caps, according to the developer of financial indices.
The company said the new benchmarks “will make it easier for investors to access and assess this emerging technology-driven asset class while potentially mitigating some of the common risks associated with this traditionally speculative market.
S&P Dow Jones Indices has previously launched the S&P Bitcoin and S&P Ethereum indices as well as the S&P Cryptocurrency MegaCap Index measuring the combined performance of those two digital currencies.
Crypto Trading Volumes Tumble 40% as Bitcoin Suffers
