Aggregate crypto market value has dipped below $800 million, according to CoinMarketCap – the first time since the beginning of 2021. At one point in 2021, crypto markets were hovering around $3 trillion and thus have endured a spectacular decline in value. At one point today, Bitcoin traded well below $16,000 but has since recovered a bit. The crypto ice age, fueled largely by dramatic collapses like TerraUSD/LUNA, 3AC, Voyager, Celsius, and most recently, FTX, has caused investors to question the viability of crypto markets and the platforms that enable trading.
Some crypto industry participants now state the failure of FTX has set back the digital asset industry by years. Importantly, policymakers are now backing away from pursuing more enabling regulation and now focusing more on investor protection concerns.
The industry holds most of the blame, though, as it has squandered interest and support as it sought out hyperbolic growth and unsustainable returns. This, combined with a lack of industry leadership, has led to debacles like the FTX bankruptcy that has decimated trust in crypto markets.
Earlier today, Binance, via its CoinMarketCap subsidiary, took a step in the right direction by allowing crypto exchanges to post reserves as a path to generate more confidence in these markets. While it is not immediately clear if crypto exchanges will embrace the new exchange reserve dashboard feature, if they do not they will probably drive more trading to Binance which is the only platform posting the information.
At the same time, CoinMarketCap has a ranking system for exchanges. The CoinMarketCap score is described as follows:
“CoinMarketCap ranks and scores exchanges based on the following: Web Traffic Factor; Average Liquidity; Volume, as well as the Confidence that the volume reported by an exchange is legitimate. Weights are assigned to the above-mentioned factors and a score from 0.0 to 10.0 is given to the Spot Exchange.”
Binance is ranked at 9.9, followed by Coinbase (8.3) and then Kraken (7.9). Binance.US is at 7.2.
For comparison, FTX is at o.1 (alongside some other platforms). FTX.US is not rated.