From cointelegraph by Stephen Katte

Monthly crypto exchange volume hit a three-year high in November, sparked by Donald Trump’s election win at the start of the month, along with renewed hopes of more favorable crypto regulations.

According to data shared by crypto market tracker New Hedge, spot crypto exchange volumes hit $2.9 trillion in November, the highest since May 2021. A spokesperson from exchange Crypto.com says November was its “strongest month in the last year,” reaching record-high volume levels on the platform. 

Crypto exchange volumes hit nearly $3 trillion in November as hopes of more favorable crypto regulations coaxed new people into the space. Source: New Hedge

“As a company and as an industry, we’re seeing increasing interest and investment in cryptocurrencies, which has led to record trading volumes globally over the last few weeks,” they said. 

“We anticipate positive market sentiment will continue into the first quarter of next year,” they added. 

According to the spokesperson, the increase was likely sparked by the recent election outcome in the United States and the prospect of further regulatory clarity in the major market.

Hundreds of pro-crypto candidates won seats in Congress, and industry leaders have suggested the US government will become the most pro-crypto in history, which should result in a more favorable regulatory environment. 

Outside the US, there is “more certainty to the industry and those wanting to invest in crypto,” thanks partly to jurisdictions either introducing or committing to regulatory frameworks for digital assets. 

“This has been an important factor in driving global adoption and increasing trading volumes,” they added.

Kraken’s managing director for Australia, Jonathon Miller, told Cointelegraph that the exchange also experienced a solid month, especially in perpetual volume.

According to Miller, Bitcoin BTC$95,388 perpetuals have made up most of the activity, with Solana SOL$226.31 and Dogecoin DOGE$0.4177 perpetuals setting new monthly all-time highs. 

“Kraken has experienced a surge in our perpetual contract volumes as a variety of traders have sought leveraged exposure or to hedge risk throughout the post-election market upturn,” Miller said. 

Related: Crypto trading volume to exceed $108T in 2024, with Europe in the lead

“While much of this activity has been concentrated in Bitcoin futures, interest in both our Dogecoin and Solana perpetuals has reached new highs, with 24-hour volume for DOGE exceeding that of Ether for the first time.” 

Miller says both assets have exhibited greater volatility, presenting more trading opportunities this year, and have been clear beneficiaries of the recent rally, with Dogecoin at the “forefront of the move in memecoins.”

Bitcoin ETFs contributed to bumper month

Speaking to Cointelegraph, a Binance spokesperson said that the exchange has “observed more participants entering the crypto space.” 

They speculate it could be due to a variety of factors, such as the Bitcoin exchange-traded funds (ETFs) approval in major markets and continued success. 

In November, a month long bull run saw spot Bitcoin ETFs rake in a combined $6.87 billion, with outflows of $411 million. 

While the total market cap for the entire crypto market has continued to climb, and is sitting at $3.47 trillion as of Dec. 2, according to CoinMarketCap.

The total market cap for the entire crypto market has continued to climb to new all-time highs this year. Source: CoinMarketCap

“The introduction of Bitcoin ETF options has made it easier for institutional investors to gain exposure and hedge risks, contributing significantly to the recent rally,” the Binance spokesperson said. 

“With substantial inflows into these ETFs, Bitcoin is poised for further integration into mainstream financial markets.”

The recent shift in macroeconomic conditions has also played a considerable role in Bitcoin’s rally, the Binance spokesperson says. 

Specifically, the US Federal Reserve cutting interest rates after a prolonged period of tightening, global liquidity rising and capital flowing into assets perceived as inflation-resistant and scarce.

“The prospect of a crypto-friendly Trump administration has injected optimism into the market, with promises to transform the US into a global crypto hub made on the campaign trail,” the Binance spokesperson said. 

“Rhetoric around the US Strategic Bitcoin Reserve and potential regulatory changes are further boosting investor confidence.”