Top-Tier Cryptocurrency Exchanges Are Gaining Market Share: CryptoCompare Report

Top-Tier Cryptocurrency Exchanges Are Gaining Market Share: CryptoCompare Report

CryptoCompare’ has published an updated version of its Exchange Benchmark, which was established in 2019 to help crypto users assess cryptocurrency exchange risks, and the findings show Top-Tier trading platforms are gaining market share.

According to the latest Exchange Benchmark report, Top-Tier cryptocurrency exchanges, those graded AA-B on the report, have been gaining market share against lower-tier exchanges, those graded C-E. It details that Top-tier exchanges accounted for 32% of the global volumes in Q4 2019, while in the first quarter of this year they accounted for 36%.

In the second quarter of 2020, the Top-Tier exchanges already accounted for 40% of global trading volumes. In June, trading platforms with the highest gradings account for 46% of global volumes, while Lower-Tier exchanges accounted for 54%. Overall, Lower-Tier exchanges saw their market share of the cryptocurrency space’s total trading volume drop from 68% to 60% in the last three quarters.

chart.pngSource: CryptoCompare

Since the latest Exchange Benchmark, CryptoCompare made a few changes to its ranking by adding a know-your-customer (KYC) risk category using CipherTrace’s KYC and Integration Risk Ratings., and added an Asset Quality/Diversity Category offered in collaboration with Flipside Crypto’s FCAS coin ratings.

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Other changes made include the addition of a specific ranking made for decentralized cryptocurrency exchanges (DEXs) and the expansion of the grading system to include a “BB” category, in which Top-Tier exchanges are inserted.

In total, only 68 cryptoasset trading platforms received a grade between AA and B, meaning these were considered Top-Tier exchanges. Receiving the highest rating, AA, were only two crypto trading platforms: Coinbase and Gemini. Nine trading platforms received an “A” grade, while 22 received a “BB” grade, and 38 received a “B” grade.

Notably, exchanges with the top grade accounted for 1.6% of the aggregate trading volume, while “A” exchanges account for 11.9% of the volume. Exchanges with a “C” grade accounted for the majority of the aggregate trading volume, as they traded $180 billion, or 37.1%.

As CryptoGlobe reported, CryptoCompare’s June 2020 Exchange Review found that spot trading volumes in the crypto space plummeted to “roughly half of the daily volumes” seen in May. In total, Top-Tier exchange saw their volume drop 36% in June, while Lower-Tier exchanges saw their volume drop 53%.

Featured image via Pixabay.