Sun March 1, 2026 ▪
4
min read ▪ by
Centralized crypto markets are under constant pressure due to the continued decline in spot trading. For five consecutive months, volumes on major exchanges have fallen, signaling weaker participation and a clear reduction in speculative appetite. The large liquidation event in October accelerated this slowdown and affected both the spot and derivatives markets. Although there was a brief recovery in January, overall activity remains well below the highs of the previous cycle.
In short
- Spot trading has been down for five consecutive months after the October liquidation shock.
- Binance’s market share drops to 20% as activity shifts to smaller exchanges.
- The altcoin season index drops to 35, signaling a return to BTC dominance.
- The supply of stablecoins is growing, but spot demand and derivatives activity remain weak.
Binance market share drops to 20% due to crypto spot contracts
Spot volumes started to fall at the beginning of October, when the sharp dislocation of the market on 10-11 October triggered forced liquidations and drained the liquidity of derivatives. The shock hit trading desks and retail platforms, leaving thinner order books and reduced risk tolerance. October did not appear to be a temporary disruption, but it did change the level of participation across centralized sites.
Binance, once the dominant force in spot trading, has seen its market share decline. Its share of total spot volume now stands at nearly 20%, while around 68% of activity has shifted to smaller, less recognizable exchanges.
Although Binance continues to attract Bitcoin and Ethereum deposits, turnover on these balances has remained muted. Short-term price spikes are constantly met with selling pressure, preventing a sustained recovery in volume.
Daily spot volumes on centralized exchanges are currently around $111 billion – a sharp decline from the more than $518 billion recorded in October 2025. This decline reflects falling open interest and weaker derivatives activity, reinforcing a broader slowdown in speculative placement.
The current market environment is shaped by several structural changes:
- Altcoin trading on Binance has fallen below 40% of total volume, down from previous peaks of nearly 60%, reflecting less engagement in established tokens.
- Traders are switching to short-term meme tokens and newly launched assets, many of which trade outside of major centralized exchanges.
- Decentralized exchanges now account for 14.83% of total CEX-related activity, down from over 21% in summer 2025, signaling milder on-chain speculation.
- Liquidity has shifted in part towards credit platforms, reducing the capital available for active spot trading.
Centralized exchanges face volume drought as traders go on the defensive
The indicators of the altcoin season further confirm the defensive positional environment. The Altcoin Season Index fell to 35, suggesting a return to Bitcoin-dominated conditions. During risk phases, traders typically consolidate exposure to BTC, favoring its depth of liquidity and relative resilience.
The pressure is visible even in decentralized places. PancakeSwap’s share of spot trading fell from 77% in summer 2025 to around 12%. The slower momentum of meme tokens in the Binance ecosystem combined with renewed interest in Solana-based assets contributed to this reallocation.
However, the Solana ecosystem did not generate enough volume to offset the broader decline in decentralized trading activity.
Meanwhile, stablecoin supply continues to grow, but this increase in available liquidity has not translated into stronger spot demand. Compared to previous cycles, new capital appears more cautious and traders remain focused on short-term tactical positioning rather than structural accumulation. Until risk appetite recovers significantly, centralized crypto spot markets will likely operate below historical participation norms.
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James Godstime is a crypto journalist and market analyst with over three years of experience in crypto, Web3 and finance. Simplifies complex and technical ideas to engage the reader. Outside of work, he likes football and tennis, which he is passionate about.
DISCLAIMER OF LIABILITY
The views, thoughts and opinions expressed in this article are solely those of the author and should not be taken as investment advice. Before making any investment decision, do your own research.
