Who's Swimming Naked? An In-Depth Investigation into the Authenticity of Crypto Exchange Trading Volumes and Market Share

Cryptocurrency exchange trading volumes may be the biggest lie in the industry. This article uses on-chain data to deduce the true monthly trading volume of eight major centralized exchanges (CEXs), arriving at counterintuitive conclusions. Are the market shares of Binance, OKX, and Bitget underestimated?

Trading volume manipulation is virtually cost-free—market makers charge no fees, API matching eliminates the need for on-chain settlement, and VIP rebates can even make you "earn more the more you trade." As a result, if you open any exchange ranking website, about half of the numbers you see may be ghost trades.

But decentralized exchanges on the blockchain are different. Every transaction requires real margin, real gas fees, and is completely transparent. This gives us a benchmark.

We collected official reserve data and 30-day trading volume data from eight major centralized exchanges (CEXs): Binance, OKX, Bybit, Bitget, Gate.io, MEXC, KuCoin, and HTX, as well as Hyperliquid. Using Hyperliquid's on-chain data as a "benchmark," we deduced the true monthly trading volume of each exchange.

The conclusions are not surprising: of the $361 billion in trading volume reported by a certain exchange in the past 30 days, more than half is estimated to be inflated; Binance's true market share is not 39%, but may be closer to 46%; and the entire industry may have more than $300 billion in fabricated trading volume per month.

Ranking of 30-day daily average Vol/Reserve ratio

Data period: February-March 2026 (30 days) | Source: Official Proof of Reserves from various exchanges, DefiLlama, CoinGlass, Newhedge

I. Benchmark: Why is Hyperliquid the benchmark?

To determine whether the trading volume on a CEX is genuine, we first need a "benchmark." We choose Hyperliquid.

Hyperliquid is currently the largest on-chain perpetual contract DEX, with a TVL of $4.88 billion, almost entirely in USDC. The cost of fabricating its trading volume is high: each transaction requires locking USDC margin, incurring real funding costs; its OI (On-the-Book) activity is also among the highest; gas and transaction fees are unavoidable; and it is completely transparent on-chain, with every transaction auditable.

Since they are all exchanges, operating in the same field, and trading similar assets, their user habits and capital utilization efficiency should theoretically be similar. However, Hyperliquid, being primarily a contract trading platform, should have a higher capital utilization rate than CEXs, so Hyperliquid will be used as the benchmark.

Our core methodology involves calculating each exchange's "average daily trading volume/reserve ratio":

For detailed theory, please refer to: https://x.com/agintender/status/1992906704925884898?s=20

Formula = Total trading volume over 30 days ÷ 30 ÷ Core reserve assets (BTC+ETH+USDT+USDC)

Hyperliquid's total contract trading volume over the past 30 days was $206.8 billion (accurate data from DefiLlama API), averaging $6.89 billion per day, corresponding to a TVL of $4.88 billion, with a daily average ratio of 1.44x.

This 1.44x is the ceiling for "honest trading". Considering that CEXs have more diverse uses for funds than pure contract DEXs (including spot trading, wealth management, lending, etc.), we give CEXs a 15% tolerance range and relax the threshold to 1.66x.

II. Data Foundation: Verification of Reserves at Each CEX

Before deriving trading volume, the reserve data must be accurate—it is the denominator of the formula.

The following analysis uses official PoR data, with the following reserve ratios:

It's worth noting that Bitget (BTC 237%), MEXC (BTC 270%), and Gate.io (BTC 147%) all hold significantly more BTC than their users have deposited. This is because the platforms' own funds make the denominator larger, so our analysis is actually more lenient towards them.

III. 30-Day Trading Volume Overview

Data source

• Spot monthly trading volume: Newhedge (March 2026 data)

• Monthly trading volume of derivatives: Average of multiple snapshots from CoinGlass × 30 (marked as an estimate)

• Hyperliquid: DefiLlama API 30-day data

IV. Contract Trading Volume Breakdown

Contracts are the absolute mainstay of CEX trading volume, and their authenticity directly determines the credibility of the total volume.

Contract vs. Spot: Two-Dimensional Anomaly Detection (Bubble Chart)

Binance's contract trading volume is highly likely genuine. The 0.36x figure is significantly lower than the on-chain benchmark—each $1 of reserves corresponds to only $0.36 of the average daily contract trading volume. The platform has a large amount of "silent funds," a typical sign of a healthy ecosystem.

Bitget and KuCoin are performing generally well in terms of contract ratios. Both have contract ratios (1.33x and 1.27x) lower than the Hyperliquid benchmark.

Gate.io operates in a gray area. Its contract ratio of 1.75x is 22% higher than the benchmark. Considering the 15% tolerance range (threshold 1.66x), Gate.io is just above the limit. However, Gate.io holds 147% of its BTC excess reserves, and proprietary trading may partially explain the high contract volume.

MEXC's signal was the strongest. Its contract ratio of 2.95x is 2.1 times that of the Hyperliquid benchmark. (Later investigation revealed this was likely due to MEXC's trading incentive program.)

V. Independent Signals of Spot Trading Volume

30-day spot data (from Newhedge) provides a verification dimension independent of derivatives:

MEXC and KuCoin have significantly higher daily spot trading ratios (0.81x and 0.98x) than other exchanges. Gate.io (0.278x) is within a reasonable range.

In contrast to Binance (0.081x) and OKX (0.059x), the vast majority of funds are "dormant," held by users for long-term investment or wealth management. This is precisely the model that large, mature exchanges should have.

VI. Inverse Deduction from Actual Transaction Volume

For exchanges whose daily average total ratio exceeds the tolerance threshold (1.66x), we will consider the excess portion as "suspicious trading volume":

Reserve Rate Heat Table

MEXC's monthly suspicious transaction volume is approximately $201 billion. This means that MEXC has an average of about $6.7 billion in suspicious transactions per day. (Later investigations revealed that this was likely due to MEXC's trading incentive programs.)

KuCoin's inflated figures are concentrated in the spot market. While the contract market is normal, the monthly spot volume of $65 billion is significantly higher than the $2.2 billion in reserves.

Gate.io is slightly suspected of inflating its figures. Its contract ratio of 1.75x is just above the threshold, while its total ratio of 2.03x is in the "watch zone." The estimated monthly trading volume of approximately $54 billion (about 18%) may be high. However, Gate.io 's excess BTC reserves (147%) and overall reserve ratio of 122% both indicate healthy fundamentals—the inflated figures are more likely due to market maker incentives than systemic fraud.

The trading volumes of Binance, OKX, Bybit, HTX, and Bitget are generally reliable. All five have contract ratios lower than the Hyperliquid benchmark.

VII. The Truth About CEX Market Share

Among the eight major centralized exchanges (CEXs), Binance's monthly market share is 39.1% ($1,459 billion / $3,725 billion). In recent years, there have been many claims that Binance is "losing market share"—with exchanges like MEXC and Gate.io rapidly eroding its share.

Note: This percentage is not a percentage of the entire market, but a percentage of the data in this report. This report only samples these eight exchanges, and the actual conclusions will certainly have errors!

However, if suspicious transactions are removed and the calculation is recalculated:

Market Share – Reported Value vs. Adjusted Value

Binance's real monthly market share is close to 46%. It's not that Binance is losing market share, but rather that some competitors are creating the illusion of "catching up" by using fake transaction volume.

The top three crypto traders collectively account for 76% of the real market. Binance (45.7%) + OKX (17.3%) + Bybit (12.6%) = 75.6%. The concentration of crypto trading is far higher than the report data suggests—the head effect is "diluted" by fake trading volume.

MEXC's true share is likely only 5%. The reported 9.7% has shrunk by nearly half. Gate.io 's adjustment was moderate (7.9% → 7.5%), which is relatively healthy among mid-sized exchanges.

VIII. Industry Impact

Genuine trading volume vs. suspicious trading volume (monthly)

MEXC ~$201 billion + Gate.io ~$54 billion + KuCoin ~$40 billion = $295 billion/month in suspicious trading volume. If we include hundreds of small and medium-sized exchanges, the industry's overall monthly fraudulent trading volume may be in the range of $350-450 billion.

For ordinary users: Don't be misled by "trading volume rankings." An exchange with a monthly trading volume of $361 billion may only have a real trading volume of $160 billion. When choosing an exchange, look at the volume/reserve ratio, not the absolute trading volume.

For project teams: When choosing an exchange for listing, look at the actual order book depth rather than the reported trading volume. More than half of the trades in the monthly report may not actually exist.

For regulators: The Hyperliquid benchmark provides a reproducible quantitative detection tool. As on-chain exchange data accumulates, analysis over 30-day and 90-day periods will make fraud increasingly difficult to detect.

IX. Methodology and Limitations

Hyperliquid's benchmark may be too high. Pure contract platforms dedicate all user funds to trading, making their capital efficiency inherently higher than CEXs. 1.44x might already be a high benchmark for CEXs, meaning our estimate may be conservative.

Excess reserves have blurred the lines. Bitget (BTC 237%), MEXC (BTC 270%), and Gate.io (BTC 147%) have their own funds driving up the ratios, but this does not equate to wash trading.

The 30-day derivatives trading volume is an estimate. CEX 30-day derivatives trading volume is estimated based on multiple snapshots from CoinGlass, and is not precise historical data. The 30-day spot trading volume is from precise monthly data from Newhedge.

Reserve data comes from self-disclosure. If reserves are overstated, our ratios will be lowered and the volume of suspicious transactions will be underestimated.

Conclusion: Four numbers

0.44x — Binance's 30-day average daily trading volume to reserve ratio. This is practically a "proof of innocence." While the industry is rife with false prosperity, Binance is the one that can maintain its leading position without needing to inflate its volume.

56% — This represents a possible percentage of inflated monthly trading volume reported by MEXC. The $361 billion monthly trading volume to $3.2 billion in reserves represents a daily ratio of 3.76x, which is 2.6 times the benchmark. Approximately $201 billion in monthly trading volume may be fictitious.

46% – Binance's adjusted true monthly market share. While it appears to be only 39%, after stripping away the inflated figures from competitors, Binance's true dominance is close to half. Some exchanges claiming to be catching up with Binance are merely chasing their own shadows.

76% – the combined true monthly market share of the top three, adjusted. This market is more oligopolistic than retail investors imagine – fake trading volume has been masking this fact.

postscript

We initially used DefiLlama's on-chain tracking data, but after cross-validating the official Proof of Reserves from various exchanges, we discovered significant discrepancies—DefiLlama generally underestimated reserves, with discrepancies ranging from 5% to 240%.