The cryptocurrency market continued its subdued trend throughout September, with multiple key indicators showing further declines. This analysis breaks down the state of the crypto market over the past month using twelve key charts, highlighting areas of contraction and the few sectors that showed resilience.
On-Chain Transaction Volumes Decline
Both Bitcoin and Ethereum saw significant reductions in their adjusted on-chain transaction volumes during September. The total fell by 17.5%, down to $145 billion.
Bitcoin’s adjusted on-chain transaction volume dropped sharply by 20.8%, while Ethereum’s decreased by 12.6%. This indicates reduced network activity and potentially lower investor interest in moving assets on-chain.
Stablecoin Metrics Show Mixed Signals
The adjusted on-chain transaction volume for stablecoins also fell in September, declining by 10.7% to $465.2 billion. However, the total supply of issued stablecoins saw a slight increase of 0.75%, reaching $116 billion.
Among major stablecoins, USDT maintained its dominant market share at 72.3%, though this was slightly lower than in August. Meanwhile, USDC’s market share continued to shrink, falling to 20%.
Miner and Staking Revenues Drop
Bitcoin miner revenues declined further in September, falling by 6.4% to $753 million. Similarly, Ethereum staking revenue dropped by 11.2% to approximately $115 million. These reductions reflect lower network activity and diminished fee revenue.
Ethereum ETH Burn Mechanism
In September, the Ethereum network burned 44,267 ETH, equivalent to about $71.7 million. Since the implementation of EIP-1559 in August 2021, a total of 3.62 million ETH has been burned, valued at approximately $10.24 billion.
This deflationary mechanism continues to impact Ethereum’s supply dynamics, though its effect was less pronounced in a month of overall declining activity.
NFT Market Trading Volume Slumps
The NFT market on Ethereum experienced a significant contraction, with trading volume dropping by 31.8% to around $261 million. Despite this, Blur, a newer NFT marketplace, outperformed OpenSea in monthly trading volume for the eighth consecutive month.
Centralized Exchange Spot Trading Hits Multi-Year Low
Spot trading volume on compliant centralized exchanges (CEXs) fell dramatically by 28.3% in September, reaching approximately $187.7 billion. This represents the lowest level seen since October 2020.
Exchange market shares saw some shifts: Binance held 69.3% (down about 5 percentage points from August), followed by Coinbase at 10.9%, Kraken at 6.1%, BTSE at 5.2%, and LMAX Digital at 2.4%.
Grayscale’s GBTC Trading Volume Drops
The daily average trading volume for Grayscale’s Bitcoin Trust (GBTC) nearly halved in September, falling by 46.9% to $36 million. This decline reflects reduced investor interest in this traditional Bitcoin investment vehicle.
Crypto Futures and Options Activity
In the futures market, Bitcoin open interest increased by 3.9%, while Ethereum open interest rose by 11.4%. However, trading volume for Bitcoin futures declined by 20.2% to $481 billion.
The CME’s Bitcoin futures open interest decreased by 12.8% to $1.95 billion, and its daily average volume fell by 16% to approximately $1.15 billion.
Ethereum futures trading volume also dropped significantly, declining by 20.6% to about $209.7 billion for the month.
In options trading, both Bitcoin and Ethereum saw reduced open interest. Bitcoin options open interest fell by 15.6%, while Ethereum options open interest decreased by 6.4%.
Trading volumes for crypto options also declined: Bitcoin options volume dropped by 17.9% to $17.3 billion, and Ethereum options volume fell by 10% to $10.1 billion.
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Frequently Asked Questions
What caused the decline in crypto market activity in September?
Several factors contributed, including macroeconomic uncertainty, regulatory concerns, and typical seasonal volatility. Many investors adopted a wait-and-see approach, leading to reduced trading and on-chain activity.
Did any segment of the crypto market perform well in September?
Stablecoin supply slightly increased, showing continued demand for these assets. Additionally, some derivatives markets saw growing open interest despite declining trading volumes.
How does Blur continue to outperform OpenSea in NFT trading?
Blur has gained market share by offering lower fees, incentive programs for traders, and a user experience tailored toward active NFT traders rather than casual collectors.
What does the decline in miner revenues indicate?
Reduced miner revenues suggest lower transaction fees and potentially increased competition among miners. This can sometimes signal network health issues but often simply reflects periods of lower activity.
Are there signs of recovery in the crypto market?
While September showed overall declines, increasing open interest in derivatives markets might indicate that sophisticated investors are positioning for future movements, potentially signaling underlying confidence.
How important is the ETH burn mechanism for Ethereum's value?
The burn mechanism creates a deflationary pressure that can support ETH's value over time by reducing supply. However, its impact is most noticeable during periods of high network activity when more ETH is burned.