A recent report by Bloomberg mentions that only a small number of users have been sending the Bitcoin (BTC) to the largest crypto exchanges in the market.
The crypto market has gone through thick and thin in the past few years, and the volatility of the market hasn’t been able to affect much on the cryptocurrency users and investors during this time. However, with the emergence of new exchanges, the competition has increased, and big exchanges have more competitors in the market. So, users have more alternatives to opt for trading, which provide them with better services.
According to a report by TokenAnalyst, a crypto data tracker affirms that lesser crypto users have traded Bitcoin on the major exchanges. The study found that since the price of Bitcoin skyrocketed back in 2017, the number of unique addresses has declined that used to send BTC across various crypto exchanges — specifically the big exchanges including Bitfinex and Binance.
The metadata describes that the trading (sending) volume of Bitcoin on Bitfinex has been at a two-year low, while on Binance, the world’s largest exchange by volume, the trading volume has dropped to lowest after early 2018.
One reason for the lack of sending Bitcoin can be due to the emergence of new crypto assets (or maybe some other reasons). The co-founder of TokenAnalyst, Sid Shekhar, stated that the lack of retail interest in general in crypto is one reason that users are not using Bitcoin much now.
Some data collected from other studies also show that Bitcoin exchange trade volume has fallen down and has come at its lowest point since May. As per the stats shared by blockchain.com, the trading volume on different exchanges has been dropping since early 2018. Another tracker, Similarweb stated that Bitcoin is trading at the lowest volume in the last four months.
However, certain aspects are tricky to understand about cryptocurrency. Due to the feature of anonymity that cryptocurrency possesses, it is challenging to locate the data of these assets. According to Chainalysis, the on-chain transaction activity of Bitcoin has almost increased 4X more this year, after BTC touched the highest price mark since 2017, as the bull run ended in June.
Previously the stats also show that Bitcoin has never been the most used crypto for real-time usage, even Dogecoin (DOGE) has been ahead of BTC. According to another survey by Foundation of Interwallet Operability mentioned that among all the crypto holders of Bitcoin only 11% of them made a trade or payment, each transaction being followed once or twice a week in the entire year.
Exchanges need to improve their services to gain user loyalty. Bitfinex and Binance, both of these exchanges, have laid out a broader availability of margin trading, through which users will be able to borrow funds to speculate. It’s evident that the more services an exchange provides, the more users will be satisfied and use its services frequently.
Indeed, more than Bitcoin, the exchanges have more interest in trading because that’s where they earn and make retained earnings. Exchanges need to shape up a better network that is more user-friendly and lie precisely on the perceived value of their user or trader.
As more exchanges have entered the market, so the competition has grown, and users have more alternatives. The big exchanges need to come up with a user incentive policy that helps them to sustain and increase these trading volumes.
Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.