LTP Research Releases Exchange Liquidity Report for June 2024
LTP liquidity scores and liquidity indices intuitively demonstrate how liquidity on major exchanges fluctuates with Bitcoin price volatility.
In the trading world, liquidity is crucial for any type of investor, trader, or exchange. This report aims to provide insights into liquidity changes by introducing and analyzing liquidity from the perspective of order book depth on centralized cryptocurrency exchanges. LTP, as a top prime brokerage in the cryptocurrency industry, utilizes an innovative liquidity scoring method to comprehensively evaluate exchange liquidity performance.
By comparing order book depth data for over 13 cryptocurrency pairs on 12 mainstream exchanges, we introduce LTP liquidity scores for evaluating exchange and token liquidity. Additionally, by aggregating and standardizing historical liquidity scores of exchanges, we introduce the LTP liquidity index to showcase trends in overall market liquidity changes.
Liquidity scores and liquidity indices intuitively demonstrate how liquidity on major exchanges fluctuates with Bitcoin price volatility. By comparing these indicators, the following key points are derived in this report:
The top four exchanges with the best liquidity are Binance, Kraken, Coinbase, and OKX, and their rankings have remained relatively stable over time.
Since March 2024, the liquidity performance of Gate and KuCoin has gradually improved, while Bitfinex’s liquidity has shown higher volatility.
Bitcoin liquidity performance: Only within the 0.1% price range, Binance consistently maintains a leading position in liquidity performance. Once the price range exceeds 0.3%, the liquidity of Bitcoin trading pairs on Binance becomes more volatile, while Kraken’s liquidity performance is relatively higher.
Ethereum liquidity performance: Compared to Bitcoin, Ethereum’s liquidity is more volatile across all exchanges within five price ranges. Conversely, only when the price range exceeds 0.3%, does Binance’s Ethereum liquidity score become more stable.
Observing the LTP Liquidity Index (LLI), which represents LTP’s liquidity index, from January to June 2024, LLI steadily increases and shows five liquidity peaks. The first three occurred in March when the Bitcoin price broke previous highs, and the last two occurred in early June.
The following image shows the layered depth data of BTC order books from three exchanges. Although the actual calculation divides BTC order book depth data into five layers (0-0.1%, 0.1%-0.2%, 0.2%-0.3%, 0.3%-0.4%, 0.4%-0.5%), for clarity, this image only displays the first three layers. It is not difficult to notice that liquidity peaks in March primarily occurred within the 0.2%-0.3% range.
Click the link below to read or download the complete PDF version of the report:
https://ltp.docsend.com/view/fw27cfg2ymwqsd87
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