Crypto exchange revenue jumps by 600% and surpasses traditional markets in 2021

Rick Steves

Global trading revenue generated by cryptocurrency exchanges hit $24.3 billion in 2021, having surpassed total revenue generated by traditional stock exchanges like the New York Stock Exchange and the Nasdaq for the first time ever, according to a report by Opimas.

The top ten cryptocurrency exchanges are bringing in as much as $3 million per day in profit, according to Bloomberg estimates. This industry didn’t exist before 2009, which makes the deed even more astonishing.

It is easy enough to understand how cryptocurrency exchanges make their money–by charging fees for users who sell, buy, and withdraw cryptocurrencies.

Global trading revenue generated by cryptocurrency exchanges hit $24.3 billion in 2021, having surpassed total revenue generated by traditional stock exchanges like the New York Stock Exchange and the Nasdaq for the first time ever, according to a report by Opimas.

Revenue at crypto exchanges increased seven times from the $3.4 billion in sales recorded in 2020 and was 60% higher than the roughly $15.2 billion brought in by traditional securities exchanges, the report added.

Revenue growth of approximately 600% is quite a figure on a year over year comparison. The digital asset industry is clearly far from stabilizing its volumes as the crypto space continues to mature and institutional participants join the party amid increasing security, liquidity, and regulatory approval.

Traditional exchanges had 4x greater revenue in 2020

Suzannah Balluffi, an Opimas analyst who covers the digital asset industry, said:  “This is quite a shift from only a year earlier, when the traditional exchanges had revenues four times greater than exchanges of the crypto world. The old, venerable names like the New York Stock Exchange, Nasdaq, Deutsche Borse and CME have all been left behind in the dust by crypto startups Binance and Coinbase.”

“This explosive growth comes against a backdrop of heightened regulatory scrutiny, following President Joe Biden’s recent executive order that directed federal departments and agencies to produce recommendations for oversight of the digital asset industry”, said the Opimas report.

Securities and Exchange Commission Chairman Gary Gensler told MarketWatch in a February interview that beefing up cryptocurrency exchange regulation will be a top priority for the agency in the months and years to come.

He noted that the vast majority of crypto trades happen on centralized exchanges and that “that activity centralized on those platforms they need the investor protection, the market integrity and anti-manipulation” rules that govern markets for other financial assets.

 

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