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2020 Cryptocurrency Spot Trading Research Annual Report

TI Research

icon We expect that the trading volume of spot and derivatives will have substantial growth in the future. We have a optimistic perspective towards the performance of ETH and BTC in 2021; in addition, due to the increase in trading volume, the revenue of the exchanges will inevitably increase, which will eventually be reflected in the price of the exchange tokens, so we are also optimistic about the exchange tokens' performance in 2021. 2021 will be a year of projects with more users and applications. Institutions cannot drive the bull market. The real bull market must rely on projects, retail investors, and spot market; derivatives will increase the effect of the bull market;
  • Compared with 2019, the cryptocurrency market in 2020 has made great progress;
  • Affected by the 3.12 market crash, the total trading volume for March reached the highest throughout the year, which was at $2,490 billion;
  • Most of the cryptocurrencies represented by Bitcoin have gained further recognition including investors from traditional markets. Take the spot market as an example. In 2020, the spot trading volume of the whole market rose by more than 50% to 21 trillion US dollars, and the total market cap once exceeded one trillion US dollars, surpassing the total stock market value of Singapore, Australia, and New Zealand. The huge returns brought by cryptocurrency investment have attracted a large number of institutional investors to enter the market;
  • On the other hand, various countries have begun to regulate the cryptocurrency market. With the issuance of licenses related to cryptocurrency, the market has begun to move out of the grey area. Although the introduction of regulation may have an impact on the market in the short term, in the long run, it will definitely protect investors and help the market to develop;
  • DeFi and derivatives are the rising stars in 2020. Within just one year, the trading volume of the DEX has expanded from a less than 0.01% to more than 1% of the spot market trading volume, and it is still in a state of rapid expansion;
  • More than 95% of the trading volume of DEX happened in 2020H2, and some DEX is already comparable to centralized exchanges in terms of the trading volume;
  • In 2020, the trading volume of exchange tokens has shrunk. The overall trading volume of exchange tokens is approximately US$250 billion, accounting for 1.19% of the total spot volume;
  • The price of platform tokens is closely related to the market status of the corresponding platform. The price of platform tokens for large exchanges have all experienced a certain increase while the price of platform tokens for smaller exchanges could hardly rise even in a bull market;
  • The Bitcoin dominance has decreased in 2020 in terms of trading volume, with 44% of the total spot trading volume for the whole year and only 31% for Q3;
  • Binance ranked first in spot trading volume, and the gap between Binance and the second and third largest exchanges in the second half of 2020 is particularly widening. The annual transaction volume for Binance is about 1 trillion;
  • We expect that the trading volume of spot and derivatives will have substantial growth in the future. We have an optimistic perspective towards the performance of ETH and BTC in 2021; in addition, due to the increase in trading volume, the revenue of the exchanges will inevitably increase, which will eventually be reflected in the price of the exchange tokens, so we are also optimistic about the exchange tokens' performance in 2021. 2021 will be a year of projects with more users and applications. Institutions cannot drive the bull market. The real bull market must rely on projects, retail investors, and spot market; derivatives will increase the effect of the bull market.
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