# WORLD CRYPTO EXCHANGES: A GROWING MARKET

Exchanges provide on-off ramps for users wishing to buy or sell cryptocurrency. The exchange sector is the first to have emerged in the cryptocurrency industry and remains the largest sector both in terms of the number of companies and employees.

*2017 Global Crypto Currency Benchmarking Study, Cambridge Centre of Alternative Finance.*

Exchanges were one of the first services to emerge in the cryptocurrency industry: while the first exchange was founded in early 2010 as a project to enable early users to trade bitcoin and thereby establish a market price.

In today’s world Crypto Exchanges provide services to buy and sell cryptocurrencies and other digital assets for national currencies and other cryptocurrencies and play an essential role in the cryptocurrency economy by offering a marketplace for trading, liquidity, and price discovery.

**Statistical study suggests:**

• Crypto exchange sector has the highest number of operating entities and employs the most people. Over 52% of small exchanges hold a formal government license comparing to 35% of large exchanges.

• 73% of small exchanges have one or two cryptocurrencies listed, while 72% of large exchanges provide trading support for two or more cryptocurrencies: bitcoin is supported by all exchanges, followed by ether (43%) and litecoin (35%).

A handful of large exchanges and four national currencies (USD, EUR, JPY and CNY) dominate global cryptocurrency trading volumes while trading in 42 different national currencies*.*

• 53% of exchanges support national currencies other than the five global reserve currencies (USD, CNY, EUR, GBP, JPY).

• Exchange services/activities fall into three categories: order-book exchanges, brokerage services and trading platforms while 72% of small exchanges specialize in one type of exchange activity (brokerage services being the most widely offered), while the same percentage of large exchanges are providing multiple exchange activities.

• 73% of exchanges take custody of user funds, 23% let users control keys.

While global cryptocurrency trading volume is dominated by four reserve currencies, trading in at least 40 other national currencies is supported the exchange market is dominated by a handful of exchanges that are responsible for the majority of global bitcoin trading volumes, of which the lion share is denominated in a small number of international currencies. In contrast, the majority of exchanges (mostly small) specialize in local markets by supporting local currencies: 53% of all exchanges support national currencies other than the five reserve currencies. Trading volumes at most small exchanges are insignificant compared to the market leaders, but these exchanges service local markets and make cryptocurrencies more available in many countries.

**Small Exchanges are specializing mostly in one trading activity while most Large Exchanges active with multiple exchange features*****-***

<figure><img src="https://2412912809-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FGnqxKQjgxlxGXBWryJ75%2Fuploads%2Fz8Iekcxc5g1pmYZgtjEo%2Fimage.png?alt=media&#x26;token=31b2dca7-9df4-4e0b-8077-329a53bb9d3f" alt=""><figcaption></figcaption></figure>

<figure><img src="https://2412912809-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FGnqxKQjgxlxGXBWryJ75%2Fuploads%2FVTym3nqDlN3YCK6OuE2h%2Fimage.png?alt=media&#x26;token=c2687973-f3f9-459c-b4f7-a5780df27edf" alt=""><figcaption></figcaption></figure>

Europe is dominating the market and with China restrictions many exchanges, including a leading Asia exchange – Binance – is planning to relocate to Europe.

<figure><img src="https://2412912809-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FGnqxKQjgxlxGXBWryJ75%2Fuploads%2FsVtOIfMeRk8D1LZxGt5H%2Fimage.png?alt=media&#x26;token=75dbcdc2-dcb6-4e9d-9c37-8358c3dec06c" alt=""><figcaption></figcaption></figure>

<figure><img src="https://2412912809-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FGnqxKQjgxlxGXBWryJ75%2Fuploads%2FZvNMlkQeyMEcRttLrJ6g%2Fimage.png?alt=media&#x26;token=1cda396a-026e-4792-aaf7-d54b647e8841" alt=""><figcaption></figcaption></figure>


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