The crypto market saw a broad correction in July 2025, with most on-chain and exchange trading metrics declining. Despite this, key trends emerged—most notably, Ethereum’s continued deflationary momentum and the sustained dominance of Binance and USDT in their respective markets. Drawing from data analyzed by The Block’s research lead Lars, this recap breaks down the month’s most important developments across blockchain activity, stablecoins, NFTs, centralized exchanges, and derivatives.
Chain Transaction Volume Trends
Bitcoin and Ethereum On-Chain Volumes Decline
July brought a significant pullback in on-chain transaction activity across major blockchains. Total adjusted on-chain volume dropped 16.9% to $188 billion, reflecting reduced user activity and market consolidation.
- Bitcoin (BTC): On-chain volume fell 13.1%
- Ethereum (ETH): Volume declined more sharply at 21.9%
This dip aligns with broader market sentiment during a period of lower volatility and reduced speculative trading. While BTC maintained relatively stable usage, Ethereum’s sharper drop may reflect seasonal lulls in DeFi and NFT activity.
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Stablecoin Transaction Volume Also Down
Stablecoin on-chain transaction volume totaled $487.8 billion in July—a 12.3% decrease from the previous month. This mirrors the broader trend of reduced liquidity movement across chains.
Other notable shifts:
- Total stablecoin issuance dipped 1% to $117.7 billion
- USDT (Tether) increased its market share to 71.5%, reinforcing its position as the dominant stablecoin
- USDC saw its share fall to 20.9%, likely due to ongoing regulatory scrutiny and slower adoption growth
The growing dominance of USDT highlights its entrenched role in global crypto trading, remittances, and liquidity provision—even amid regulatory uncertainty.
Ethereum Network Insights
Ethereum Remains Deflationary in 2025
One of the most significant ongoing trends in crypto is Ethereum’s persistent deflationary supply model. Since the implementation of EIP-1559, over 3.51 million ETH (valued at approximately $100.4 billion) have been burned through transaction fee mechanisms.
In July alone:
- 82,846 ETH (around $156.7 million) were burned
- Monthly burn rates have consistently exceeded issuance since January 2025
This structural shift means that as network usage continues—even at moderate levels—Ethereum’s supply slowly contracts, potentially creating long-term scarcity dynamics favorable to holders.
"Ethereum's deflationary mechanism isn't just theoretical—it's active, measurable, and compounding over time." – On-chain analyst commentary
Ethereum NFT Volume Drops 20%
NFT trading activity on Ethereum declined by 20.4% in July, with monthly volume settling at $425 million. This follows a broader cooling in collector enthusiasm and lower floor prices across major collections.
Despite the drop:
- Blur extended its lead over OpenSea for the sixth consecutive month in terms of reported trading volume
However, it's important to note that Blur’s volume dominance is partly driven by token incentive programs, which have raised concerns about wash trading and inflated metrics. Some industry figures, including well-known NFT collector Pranksy, have criticized the platform for distorting true market demand.
Centralized Exchange (CEX) Landscape
Spot Trading Volumes Hit Multi-Year Lows
July’s total centralized exchange spot trading volume came in at $269.1 billion, marking the lowest monthly figure since October 2020. This reflects diminished retail participation and tighter macro conditions affecting risk assets.
Yet, within this contraction, market share distribution reveals a highly concentrated landscape.
Binance Maintains Over 70% Spot Market Share
Despite ongoing legal challenges and regulatory scrutiny, Binance continued to dominate spot trading:
- Binance: 70.6%
- Coinbase: 10.8%
- Kraken: 5%
- BTSE: 4.6%
- LMAX Digital: 3%
This concentration underscores Binance’s resilience in global markets, particularly in regions with limited access to regulated U.S.-based platforms. Reports suggest U.S. prosecutors are still evaluating potential fraud charges against the exchange—but so far, user activity shows little sign of disruption.
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Crypto Derivatives Market Overview
BTC and ETH Futures Volumes Drop Nearly 30%
Derivatives markets also cooled significantly in July:
- BTC futures trading volume: $637.2 billion (–27.1%)
- ETH futures trading volume: $312.6 billion (–25.2%)
Open interest trends diverged:
- BTC open interest fell 8.4%
- ETH open interest remained flat, suggesting stable holding patterns among leveraged traders
The decline reflects reduced leverage appetite amid sideways price action and macroeconomic caution.
CME: Diverging Paths for BTC and ETH Options
The Chicago Mercantile Exchange (CME), a key barometer for institutional sentiment, showed mixed signals:
- BTC options open interest dropped 38.6%
- BTC monthly options volume: $18.9 billion (–16%)
- ETH options open interest fell only 25%
- ETH monthly options volume rose 8.1% to $10.7 billion
The growth in ETH options volume—despite lower spot activity—suggests rising institutional interest in hedging or speculating on future price moves, possibly ahead of anticipated upgrades or ETF developments.
Frequently Asked Questions (FAQ)
Q: Why is Ethereum considered deflationary?
A: Since EIP-1559 was implemented, a portion of every transaction fee is permanently burned. When the amount burned exceeds new ETH issued as block rewards, the total supply decreases—making ETH deflationary under current network conditions.
Q: Is USDT safe to use despite regulatory concerns?
A: While USDT has faced scrutiny over reserve transparency, it remains widely used due to its liquidity and integration across exchanges. Users should always assess counterparty risk and consider diversifying stablecoin exposure.
Q: How can Binance maintain high market share amid legal issues?
A: Binance’s global reach, wide asset selection, low fees, and strong liquidity attract users outside regulated jurisdictions. However, increased oversight could impact its operations in the future.
Q: What does declining on-chain volume mean for investors?
A: Lower transaction volume may indicate reduced short-term speculation but doesn’t necessarily reflect long-term holder sentiment. It often precedes consolidation phases before renewed interest.
Q: Why is Blur’s NFT volume controversial?
A: Blur incentivizes trading with token rewards, encouraging repetitive or artificial transactions (wash trading). This inflates volume figures and distorts true market activity compared to platforms like OpenSea.
Q: Are falling derivatives volumes bearish for crypto?
A: Not necessarily. Lower volumes often follow periods of high volatility. A return to lower leverage can improve market health by reducing systemic risk from liquidations.
Final Thoughts
July 2025 painted a picture of a maturing crypto ecosystem—slower activity, concentrated market power, and structural shifts like Ethereum’s deflationary supply. While headline numbers show contraction, underlying trends reveal resilience in key areas:
- ETH’s economic model continues to evolve toward scarcity
- USDT strengthens its role as the backbone of crypto liquidity
- Binance withstands regulatory pressure with dominant trading volumes
For investors and participants, these dynamics highlight the importance of distinguishing signal from noise—especially when metrics can be influenced by incentives or short-term sentiment.
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Keywords: Ethereum deflation, USDT market share, Binance spot volume, EIP-1559 burn, stablecoin transaction volume, crypto derivatives trends, on-chain data analysis