DEX Volumes Dwindle

The falling volumes are characteristic of this stage in the market cycle.

DEXs have lost volume, but CEXs are faring even worse.

In keeping with falling trading volumes across the crypto space, decentralized exchanges are seeing reduced interest. According to industry site DeFiLlama, total volumes across all DEXs have fallen to around $10 billion per week.

DEX volumes. Source: DeFiLlama.
DEX volumes are down around 85% from their peak.

Last week's $10.2 billion volume was the lowest in almost three years, ignoring a week either side of Christmas last year, both of which saw sub-$10 billion volumes. For comparison, Christmas 2021 saw volumes almost four times as high.

Peak volumes for DEXs coincided with the first top of the bull market in 2021, when over $70 billion was traded in the course of a week. A second spike occurred during the November top.

September's total volume across all DEXs was $44 billion, a monthly low not seen since the end of 2020.

Liquidity Drying Up

Looking at only the most liquid cryptos, BTC and ETH, data from TheBlock shows that total trading volumes on major centralized exchanges is also at lows not seen since December 2020. A daily average of $3-5 billion has recently been traded for bitcoin, with ETH down at around $1-1.5 billion per day.

BTC and ETH volumes. Source: The Block
Trading volumes for BTC and ETH are close to three-year lows.

This is characteristic of the "Despair" phase of the market cycle, where no new money is coming in, and existing holders are losing hope. At the very peak of the market in 2021, over $40 billion of BTC and $30 billion of ETH was changing hands every day.

Comparing all exchanges with DEXs shows that while total volumes have fallen by around 90%, DEX volumes have fared slightly better, suggesting that DEX adoption has increased its market share, even as the market itself shrinks.

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