The derivatives market now makes up 69% of total crypto volumes, up from 66% in June, and helped push overall crypto volumes on exchanges to $4.51 trillion in July, CryptoCompare said.

Derivatives exchanges traded as much as $245 billion on July 29, 9.7% more than June’s top daily high of $223 billion. But spot cryptocurrency trading edged lower to $1.39 trillion in July, a 1.3% monthly decline and the lowest since December 2020, CryptoCompare said.

The crypto market plunged in May and June as worries about high inflation and Federal Reserve interest rate hikes prompted investors to ditch risky assets. Following the collapse of a major pair of tokens, some cryptocurrency lenders froze customer withdrawals, and several crypto firms have cut jobs.

Prices have partly recovered, with bitcoin gaining 17% in July. At around $24,300, it is still a far cry from its all-time high of $69,000 in November .

“The rise in derivatives trading volume indicates an increase in speculative activity as traders believe there is room for further upside in this rally,” CryptoCompare said, noting that there is no U.S. Federal Reserve meeting in August.

Traders are also speculating on the upcoming Ethereum merge, CryptoCompare said, referring to an upgrade of the Ethereum network which is expected in September.

Ether has risen to around $1,900 from its June low of $880 .

BinanceUSD – a stablecoin issued by crypto exchange Binance – became more prominent in July, CryptoCompare said, with spot volumes for bitcoin-to-BinanceUSD trades overtaking bitcoin-to-dollar for the first time.

Binance held on to the top spot among exchanges, with 54% of the market share, while Atom Asset Exchange (AAX) became the second largest, with volume rising 26.5% in July.

On Tuesday U.S. exchange Coinbase reported a larger-than-expected quarterly loss, with trading volumes having more than halved in the second quarter of 2022.