The crypto market recorded a historic event: Ethereum surpassed Bitcoin in spot trading volume on major centralized exchanges (CEX). According to data from CEX.IO, ETH reached 32% of total activities in August, the highest level since 2017. This shift reflects a change in traders' attention and opens a debate on market implications in the short and medium term.
On some platforms, Ethereum's dominance was even higher. On CEX.IO, for example, it represented 39% of weekly trades, compared to 28% the previous month. Much of this momentum came from transactions below $3,000, suggesting significant growth in retail participation in the ETH ecosystem.
Capital rotation: Ethereum gains ground against Bitcoin
The report details that capital rotation towards Ethereum intensified in August. Net ETH positions grew by 23%, while Bitcoin positions fell by 43%. This phenomenon not only reflects a shift in traders' preferences but also marks a structural change in investment dynamics.
In previous cycles, peaks in Ethereum's volume dominance coincided with overall market expansions, even in six of the seven altcoin bull seasons.
“In a roller coaster of prices, Ether silently dethroned Bitcoin as the most traded cryptocurrency in the spot market, indicating a decisive shift in traders' attention. Ether's volume dominance also increased each week, widening the gap with Bitcoin and other digital assets,” says the report.
Bitcoin vs Ethereum dominance in spot trading volume. Source: CEX.IO
However, the report warns that such movements can also anticipate deeper correction phases in the medium term, especially when Ethereum absorbs proportionally more capital than Bitcoin in the final stages of a bull cycle.
“In the last two cycles, Ethereum attracted proportionally more capital inflows than Bitcoin in the final months of the bull cycle. This means that markets may be approaching a more profound correction phase,” highlights the report.
Ethereum Liquidity: firm support in the market
Another key factor has been the improvement in ETH liquidity on exchanges. The market depth of 2% on CEX increased by 21% over the last three months. This indicator measures the value of buy and sell orders close to the current price, and its growth indicates a greater capacity to absorb volatility.
Although initially this increase was led by sell orders, the market has tilted toward the buy side in recent weeks. A greater presence of buy orders reinforces Ethereum's resilience and reduces the risk of sharp declines, providing protection against volatility.
Buy and sell orders for Ethereum. Source: CEX.IO
Despite this strength, ETH faces selling pressure. The net volume of takers has fallen to levels not seen since 2024, and short positions on CME hit record highs. This combination presents two possible scenarios: a short-term retraction due to massive selling or, in contrast, a short squeeze if the upward momentum continues.
Ethereum not only surpassed Bitcoin in spot trading volume but also demonstrated increasing strength in liquidity and capital attraction. The challenge will be to determine whether this milestone represents the beginning of a new phase of dominance or if it is a typical phenomenon of the advanced stage of the current cycle.
The article 'Ethereum surpasses Bitcoin in spot trading volume for the first time in 8 years' was first seen on BeInCrypto Brazil.
