Crypto Market Liquidity Falls After FTX’s Collapse

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According to Kaiko analysts, the ability to make large-scale trading transactions with digital assets without a noticeable impact on their prices has noticeably decreased after the collapse of FTX.

They have written:

“The cryptocurrency market is dominated by just a few market makers, including Wintermute, Amber Group, B2C2, Genesis, Cumberland and [now defunct] Alameda. With the loss of the latter, we can expect a significant drop in liquidity, which we called the “Alameda Gap.”

They estimate order book market depth on Kraken, Binance and Coinbase has collapsed by 57%, 25%, and 18%, respectively, since the collapse of FTX.

Regarding weekly trading volumes on exchanges, they more than doubled to $100 billion. Huobi, Bitfinex and BitMEX metrics showed the sharpest decline.

Louis Adams

I am an experienced crypto news writer. I have been in the industry for many years and believe this tech can bring financial freedom to everyone.