LTP Research released its Exchange Liquidity Report for June 2024, highlighting how liquidity on major exchanges fluctuates with Bitcoin price volatility.
In the world of trading, liquidity is crucial for any investor, trader, or exchange. This report aims to provide insights by analyzing liquidity changes from the order book depth perspective of centralized cryptocurrency exchanges. LTP, a leading Prime Brokerage in the crypto industry, employs a proprietary liquidity scoring method to comprehensively assess exchange liquidity performance.
By comparing order book depth data for over 13 cryptocurrency pairs across 12 mainstream exchanges, we introduce the LTP Liquidity Score to evaluate liquidity for exchanges and corresponding tokens. Additionally, by aggregating and standardizing historical liquidity scores of exchanges, the LTP Liquidity Index is introduced to demonstrate trends in overall market liquidity changes.
The Liquidity Score and Liquidity Index intuitively illustrate how liquidity on major exchanges varies with fluctuations in Bitcoin prices. By comparing these metrics, the report identifies the following key points:
The top four exchanges in liquidity are consistently Binance, Kraken, Coinbase, and OKX.
Since March 2024, Gate and KuCoin have shown gradual improvements in liquidity performance, whereas Bitfinex has exhibited higher volatility in liquidity.
Bitcoin Liquidity Performance: Within the 0.1% price range, Binance consistently maintains a leading position in liquidity performance. Beyond the 0.3% range, liquidity for Binance’s Bitcoin pairs becomes more volatile, with Kraken showing relatively higher liquidity performance.
Ethereum Liquidity Performance: Compared to Bitcoin, Ethereum’s liquidity is more volatile across all exchanges and price ranges. Stability in Binance’s Ethereum liquidity score is observed only when the price range exceeds 0.3%.
Observing the LTP Liquidity Index (LLI), from January to June 2024, LLI has steadily increased, marking five liquidity peaks. The first three occurred in March when Bitcoin prices surpassed previous highs, with the last two occurring in early June.
The figures below illustrate tiered depth data for BTC order books on three exchanges. While BTC order book depth data is categorized into five layers (0-0.1%, 0.1%-0.2%, 0.2%-0.3%, 0.3%-0.4%, 0.4%-0.5%), the graphic displays only the top three layers for clarity, highlighting liquidity peaks primarily in the 0.2%-0.3% range in March.
For the complete PDF version of the report, click the link:
https://ltp.docsend.com/view/fw27cfg2ymwqsd87