CoinMarketCap 2023 H1 Exchange Data Report: Who will list the most coins? Will Binance maintain its dominant position?

The cryptocurrency information platform CoinMarketCap released the "Unveiling the Crypto Market" report for the first half of 2023 today, delving into data on both Centralized Exchanges (CEX) and Decentralized Exchanges (DEX). How significant is the difference in trading volume between CEX and DEX, and how have exchange tokens performed so far this year?

This article summarizes the key points, for the full report please refer here.

Decoding CoinMarketCap's Centralized Exchange (CEX) Data

The chart below shows the total spot trading volume of the top 20 exchanges in the past 4 quarters. It can be seen that the trading volume in the first quarter of this year increased by about 26% compared to the previous quarter. CoinMarketCap attributes this significant growth to the rise in Bitcoin prices, which increased by 72.1% in that quarter.

However, in the second quarter, the trading volume significantly slowed down, dropping by about 36% compared to the previous quarter. CoinMarketCap stated that the current trading volume is very similar to the market conditions observed in the recovery phase after the FTX collapse.

Looking at individual exchanges, Binance still dominates the spot market share steadily, reaching nearly 60% in February of this year, but later dropped to around 47%. The second and third places are held by BitForex and OKX, with spot trading volume shares of 7.7% and 6%, respectively.

Among these exchanges, Gate.io has the most trading pairs in terms of Current Number of Markets, followed by Binance. However, in terms of the number of coins in circulation, Binance is not as prominent, as CoinMarketCap stated that this is because Binance selects mostly high-quality mainstream coins.

Furthermore, CoinMarketCap also mentioned that BitForex and Bitget were the most active exchanges in listing new coins during the meme season from quarter 4 to quarter 6 of this year.

In terms of security, among the disclosed exchanges, Binance has the highest reserves with $57 billion, followed by OKX with $10 billion and Bitfinex with $10 billion in reserve proof of assets. Most exchanges' reserves consist mainly of Bitcoin and stablecoins.

The chart below clearly shows a significant decline in Binance's reserve assets in June, which is related to the market reaction triggered by the SEC's lawsuit against them. The outflow of funds led to a decrease of approximately $20 billion in Binance's reserves.

Although this year's exchange trading volume is not particularly outstanding, and the market sentiment is relatively subdued, most exchange tokens have remained stable or shown gains, with the exception of Huobi Token, which experienced a noticeable decline.

Decoding CoinMarketCap's Decentralized Exchange (DEX) Data

After looking at CEX, let's take a look at the data of DEX. The trading volume of the top 15 exchanges reached its peak in March of this year, and although the trading volume declined in the following second quarter, it remained quite stable. The trading volume in the second quarter was $189 billion, a 24% decrease compared to the previous quarter.

Among these exchanges, Uniswap had the highest share of trading volume this year, far surpassing its competitors at 57.5%. This was followed by Pancakeswap and Curve, with shares of 12.7% and 11.5%, respectively.

When comparing Uniswap with centralized exchanges, its trading volume is roughly equivalent to Coinbase but still significantly lower than Binance.

From the beginning of this year, the proportion of DEX trading volume compared to CEX spot trading volume has gradually increased and is currently about 1:8. CoinMarketCap attributes this trend to several factors, including:

1. The latest developments in DEX products
2. Concerns about CEX due to regulatory interventions
3. More favorable conditions and lower gas fees
4. A higher proportion of native cryptocurrency participants in the current market

Lastly, Ethereum still dominates the usage among all blockchains, with approximately 80% of DEX trading volume occurring on Ethereum and its Layer2. However, in the second quarter of this year, the DEX trading volume on the BNB chain also saw an increase, accounting for about 15%.