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Crypto Exchanges Adapt and Overcome Following FTX Collapse

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Exchanges like Bybit, Kraken, and Bitget have boosted their trading volumes during the first half of 2023 following the demise of FTX, which negatively impacted the entire crypto industry, according to blockchain analytics firm Nansen. The collapse resulted in numerous investors backing away from centralized exchanges, undermining trust in them, and shifting to either self-custody or selling their cryptocurrency.

The Winners From the FTX Meltdown

The collapse of FTX in November 2022 changed the Centralized Exchange (CEX) landscape, according to Nansen, causing many exchanges to experience significant outflows and a diminished investor interest towards the end of 2022 and the start of 2023. Bitfinex, Kucoin,, and OKX seem to be among the biggest losers, with Bitfinex’s monthly trading volume dropping from over $12 billion six months before the fallout to $5 billion half a year later. On the other hand, Kraken’s spot trading volume increased by around 14%, and Bybit saw a 7% rise, with the report stating that ‘most exchanges took a hit on their spot trading volumes, with Bybit and Kraken notable exceptions, who managed to increase their volume.’ Binance, the world’s largest cryptocurrency platform, remained relatively unaffected, with a minor shift in its average monthly spot trading volume from nearly $445 billion to around $444 billion.

Derivatives trading volume in the sector observed a minor decline, with a significant spike witnessed in November last year (by the time of the collapse). Bitget was the only winner, with its average numbers in that field six months before the catastrophe being $194 billion, compared to $204 billion after the event. Bitfinex and Kucoin marked reduced levels of 40% and 41%, respectively, and were once again on the losing side.

Upgrading Security Policies

Nansen’s analysis also revealed that FTX’s collapse resulted in some exchanges advancing their investor protection programs. For example, Binance increased its Secure Asset Fund for Users (SAFU) to $1 billion, stating that the assets would only be used in case of adverse events. Similarly, Bitget raised its protection fund from $200 million to $300 million, while Coinbase, Huobi, and OKX took similar measures. Multiple marketplaces released proof-of-reserves to demonstrate that they have sufficient funds to back customer deposits, including Binance,, Kraken, Bybit, and OKX. Nansen emphasized that such moves were vital and should become the minimum standard in the exchange industry.

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