What to know:
- CoinGecko reports top 10 centralized exchange spot trading dropped to $2.7 trillion from $4.5 trillion, with March at $800 billion marking the weakest month since November 2023.
- Bearish momentum from late 2025, Kevin Warsh’s Fed nomination signaling hawkish policy, and US-Israeli strikes on Iran contributed to a 20%+ market cap decline.
- Average daily CEX volumes declined 27% to $117.8 billion, with HTX down 55%, pressuring exchange revenue and price discovery across DeFi and CeFi.
The cryptocurrency market has experienced a “prolonged crypto winter” as per CoinGecko, mainly because volumes of CEX spot trades fell by 39% in the first quarter of 2026. Market capitalization decreased by more than 20% as the bearish momentum from late 2025 was combined with a rise in geopolitical instabilities.
The CEX trading activity on the 10 largest centralized exchanges dropped to $2.7 trillion from $4.5 trillion in Q4 2025, which is a mirror of the overall risk-off sentiment. Bitcoin being at $74,803 after it had gone above $126,000 for the first time in the last six months, market structure and liquidity are being looked at again very closely in digital asset venues.
Q1 Volume Contraction Across Centralized Exchanges (CEX)
According to CoinGecko, the leading 10 spot CEX platforms achieved consistent $1 trillion volume in January and February before experiencing a decline to $800 billion in March, the weakest month since November 2023. The average daily CEX trading volumes for the crypto market stood at $117.8 billion, which is 27% less than the previous quarter.
All the top 10 exchanges faced a decrease in their volumes, with HTX, previously Huobi, experiencing the largest dip of 55% to $133.6 billion. This contraction indirectly shows how centralized liquidity is prone to macro and sentiment changes in blockchain markets.
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Macro and Geopolitical Headwinds Weigh on Crypto Markets
The report mentioned that Kevin Warsh’s nomination to be the US Federal Reserve chair is like the US Federal Reserve changing its policy to a more restrictive one. What added to the downturn was that risk assets became less attractive because the uncertainty over the US and Israeli strikes on Iran in February was not resolved.
Bitcoin dropped by 22% in the first quarter. It has been consistently underperforming the traditional benchmarks even though both the NASDAQ and S&P 500 have recorded their worst quarterly returns since 2022 at -7.1% and -4.8%, respectively.
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Outlook: Liquidity Challenges and Market Adaptation
Lower spot trading volumes impair CEX revenues, market-making, and price discovery across DeFi and CeFi. A fall in leverage and less active order books can help in stabilizing volatility, but if the market shrinkage lasts for a long time, it will affect not only protocol treasuries but also trader participation. Therefore, market players are still keeping an eye on economic policies, geopolitics, and on-chain data to detect a turning point in the market or continuing downtrend.
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