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Top-Tier Exchanges Dominate Crypto Market as Traders Go Risk-Off: Report

Exchange

www.cryptoglobe.com 23 August 2021 23:35, UTC
  
Reading time: ~2 m

Higher quality cryptocurrency trading platforms have been steadily gaining market share over the last few quarters as both retail and institutional traders choose less risky platforms, according to a newly published report.

According to CryptoCompare’s updated Exchange Benchmark, Top-Tier exchanges added 4% additional market share since February of this year and now control 89% of the cryptocurrency market’s trading volume.

CryptoCompare finds Top-Tier exchanges after ranking more than 150 global spot exchanges based on a comprehensive methodology that assesses counterparty, operational, trading and security risks.  Top-Tier exchanges, it’s worth noting, are those ranked AA-BB.

Source: CryptoCompare

Notably, only six cryptocurrency trading platforms received the highest rating, AA. These were Coinbase, Gemini, Kraken, CrossTower, itBit, and Bitstamp. Nevertheless, the number of Top-Tier exchanges grew as “operational standards increased across the board.”

Only nine exchanges were included in the AA-A ratings, due to “stricter category and transaction risk threshold requirements.” CryptoCompare pointed out know-your-customer (KYC) checks leave “much to be desired,” with 34% of platforms having “poor or inadequate KYC programs.”

Similarly, data transparency and quality standards need to be improved, with 15% of trading platforms pushing “some form of error-prone data or unannounced updates via their REST API or Websocket data feeds over the last year.”

CryptoCompare’s co-founder and CEO Charles Hayter was quoted saying:

As more individuals and institutions seek to gain exposure to digital assets, it is becoming increasingly important to benchmark which exchanges are the most trustworthy and reliable in the space.

As CryptoGlobe reported, while cryptocurrency prices started picking up in late July, spot volumes have been steadily falling. That’s according to CryptoCompare’s Exchange Review report, which details that spot volumes fell 31.5% from June to July, even though rising prices helped volumes surge late in the latter month, with a maximum of $98 billion being traded on July 26.


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