Cryptocurrency exchanges will be tested by non-local market conditions, a decline in customer activity, and the problems of a number of industry participants. Kaiko admitted that some could go bankrupt if they are not “saved” by firms like FTX or Alameda.

On our last Deep Dive, @riyad_carey covers issue exchanges as volumes slow and fees tighten.

Check it out here: https://t.co/1heLXy4SUS

— Kaiko (@KaikoData) 23 June 2022

Experts reminded that the signs of the bear market are a decrease in liquidity and a decrease in trading volumes. This puts pressure on the financial results of crypto platforms, which generate most of their income through commissions.

According to analysts’ calculations, there has been a decline in bitcoin trading volumes in recent months. The exception was the May surge caused by the volatility associated with Terra’s collapse.

Analysts also cited falling fees and additional direction problems (staking, venture investments) as risk factors for cryptocurrency platforms.

Binance.US’s zero commission decision on some bitcoin pairs could increase competition in the US market, where Gemini previously held the most vulnerable positions.

In a global context, experts have noted a noticeable increase in the market share of FTX pushing Coinbase’s position. By setting a new standard for low exchange fees, Sam Bankman-Fried’s firm has grown its client base.

Experts also drew attention to the expansion of the list of services to attract new users. Details of such products often remain opaque, they added.

In this context, the real danger comes from smaller exchanges losing market share. As an example, analysts cited a platform from Japan that bids up to 5% per year in BTC, ETH and XRP. In the documents, the firm warned that “credited cryptocurrencies are not managed as separate funds” and there is no guarantee that users will receive repayments if they go bankrupt.

Another worrying trend is the inclusion of crypto platforms in venture capital. In confirmation, Kaiko recalled Voyager’s problems with Three Arrows Capital’s liquidity difficulties, as well as Tether loans for Celsius.

Recall that Bloomberg reported that the decline of bitcoin threatened to default on $4 billion in miner loans.

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