Traditional finance, particularly the stock market, is often compared to the world of cryptocurrencies.
The correlation observed between these two markets suggests that traditional finance may be one of the key drivers behind crypto market movements.
However, when we dive into volume data, a very different story emerges.
By looking at both spot and futures volumes on Binance, the exchange with the highest trading activity, we can already see a clear distinction between the two ecosystems.
- Let’s begin with Binance’s spot market.
When compared to major traditional financial indices, Binance consistently shows much higher volume levels, often ranging between $10 billion and $75 billion during high-volatility periods.
In contrast, traditional equity indices rarely exceed $20 billion in daily volume.
A notable exception occurred on May 27, when the Nasdaq saw a dramatic volume spike, following the announcement of tariff delays and partial rollbacks on EU imported goods, an event that triggered intense trading volatility across tech stocks.
Interestingly, we can now observe a slight divergence: spot volumes on Binance are trending lower, while volumes on traditional stock indices are showing a modest increase.
This comparison clearly shows that crypto markets, as represented here by Binance, currently concentrate far more liquidity than traditional stock indices.
However, in periods of reduced risk appetite, like the current one, crypto volumes tend to shrink, while traditional equity markets appear to remain the preferred choice for capital allocation.
Written by Darkfost