On-Chain and Exchange Volumes for BTC, ETH Slide in August, Sept Likely to Repeat
The month of August was marked by a significant decline in volumes and activity on crypto markets, and it seems that September is likely to follow suit. According to research from The Block, the total adjusted on-chain volume for the leading cryptocurrencies, Bitcoin (BTC) and Ethereum (ETH), decreased by 6.3% to $176 billion in August.
Bear Market Blues
Despite the overall decline, there were some areas that experienced growth. The adjusted on-chain volume of stablecoins increased by 6.8% to $520.9 billion. However, this figure is still down approximately 35% from the numbers seen in March. Issued stablecoin supply also contracted by 2.2% to $115.1 billion in August. Tether (USDT) and Circle (USDC) slightly increased their market shares.
Additionally, crypto revenues took a hit in August. Bitcoin miner revenue decreased by 6.8% to $805 million, and Ethereum staking revenue dropped by 7.5% to $130 million. The monthly volume of NFT (Non-Fungible Token) marketplaces on Ethereum also declined by 8% to $391 million, with secondary sales dwindling.
Centralized exchange spot volume also experienced a retracement, falling by 2.8% to $261.6 billion, the lowest volume seen since October 2020. Despite increased regulatory pressure, Binance remains the market leader with a 73.4% share, followed by Coinbase at 10.2% and Kraken at 5.3%, as reported by The Block.
The month of August also saw a decline in crypto derivatives trading. The Futures Open Interest, which represents the number of outstanding contracts yet to be settled, fell by 14% for Bitcoin and 18% for Ethereum contracts. Furthermore, BTC monthly futures volume decreased by 5.4% to $603 billion, and ETH futures monthly volume fell by 15.5% to $264 billion.
Historically, September has been a quiet month for the crypto market, often characterized by more declines than gains. However, some crypto enthusiasts remain optimistic. Ethereum educator Anthony Sassano expressed his bullish sentiment, stating that late-stage crypto crab markets are more challenging for most people than bear markets. He added that this is usually the phase where even experienced investors start losing faith, but it is also when the bull market tends to return.
Crypto Market Snapshot
As of now, the crypto market remains relatively inactive, with total capitalization hovering just below $1.1 trillion. BTC is currently trading up 0.5% on the day at just under $26,000, following an intraday low of $25,800. Ethereum, on the other hand, remains flat on the day at $1,638 at the time of writing.
Overall, August showed a decline in on-chain and exchange volumes for BTC and ETH. The market faced several challenges, including declining volumes, decreased revenues, and a general lack of activity. As we move into September, it remains to be seen whether the trend of declining volumes and market activity will continue.