Daily crypto-currency trading volume hits multi-year low, as total market capitalization falls below $800 billion

The crypto-currency market has shrunk significantly in 2022, with more than $2.2 trillion liquidated in the past 12 months. According to aggregated blockchain data, daily crypto-currency cash trading volume on all exchanges plunged below $10 billion for the first time since December 2020. The collapse of Terra Luna and FTX are the biggest contributors to the 2022 crypto bear market outside of other macroeconomic factors.

As of Wednesday, December 28, the total capitalization of the crypto-currency market stands at approximately $797 billion, according to data provided by Coinmarketcap. Notably, while the total volume of the crypto-currency market stands at about $29 billion, stablecoins control the largest share with about $27 billion. The total volume of the decentralized financial ecosystem (DeFi) is currently about $2.33 billion, or 7.81% of the total 24-hour crypto market volume.

Let’s take a closer look at the outlook for the crypto-currency market

The crypto-currency market is transforming to fit the global economy. Traditional financial institutions and large technology companies are embracing blockchain technology. In addition, governments around the world are working closely with crypto-currency companies to regulate the industry for mainstream adoption.

However, the collapse of one of the largest crypto-currency exchanges in terms of daily traded volume, FTX, has raised concerns about the overall state of the crypto-currency market. In addition, approximately 1 million FTX traders and investors were left high and dry following the collapse of FTT.

As a result, crypto-currency traders have migrated en masse from centralized exchanges (CEX) to decentralized exchanges (DEX) over the past two months. In addition, non-depository crypto-currency wallets have seen significant gains in global customer base, as evidenced by Binance-backed Trust Wallet and its TWT token.

Non-fungible token (NFT) volume has also collapsed significantly since April 2022. Trump (TRUMP) digital trading cards, which recently entered the industry in the number one position, are currently ranked 42 with a low price of $179.27 and a 24-hour sales volume of 51.6 ETH.

One of the crypto projects most affected by the 2022 bear market is Solana (SOL), which has dropped approximately 94% over the past year. Notably, the Solana ecosystem was heavily supported by the FTX network and Alameda. In addition, most Solana tokens were listed and traded on the FTX exchange and used as leverage with FTT tokens.

The Future

The crypto-currency industry is expected to be trapped in the ongoing bear market in 2023. Moreover, historical data and current fundamentals show more liquidations to come. As such, market strategists predict that the total trading volume will further collapse, leaving more crypto exchanges at risk of bankruptcy.