A new report from S&P Global indicates that liquidity in crypto markets lags behind traditional finance due to fragmentation, technical differences, and exposure to external shocks. The study analyzed liquidity metrics for Bitcoin, Ethereum, and major stablecoins, showing that centralized exchanges dominate volume and provide higher liquidity compared to decentralized exchanges. Infrastructure constraints like political instability and exchange hacks can significantly impact localized liquidity. Stablecoin liquidity remains higher in crypto-to-crypto trades due to banking hurdles and compliance friction. Despite the challenges, the report suggests that the crypto market is maturing with the entry of institutional investors and regulated products.

Leave a Reply