Centralized Exchanges Lose Ground as Crypto Liquidity Dries Up
Crypto market liquidity has hit its lowest point of 2026 as daily spot volumes plummeted to around $15 billion last week, according to data from Kaiko. This represents a 70% drop from peak levels in January and a 50% decline since December 2025.
The six largest centralized exchanges now account for more than 60% of total trading activity, with decentralized exchange volumes climbing throughout the year relative to centralized platforms. In April, DEXs accounted for around 20% of volume, but by August this figure had risen to over 46%.
Pseudonymous researcher Emperor Osmo argues that the drop in trading volume on CEXs mostly reflects changing exchange dynamics, with some traders moving to decentralized exchanges. Wintermute head of OTC Jake O calls the shakeout 'healthy' and notes that 'volume consolidating on the stronger venues is a net positive for the industry.'
Major cryptocurrencies are trading far below their highs, with Bitcoin at around $64,000, down nearly 50% from its October 2025 all-time high. Ethereum, XRP, and Solana have fared even worse, dropping 62%, 70%, and 75% respectively.