The trading volume of on-chain derivatives has been declining for three consecutive weeks, indicating a cooling market risk appetite

According to data from DefiLlama, the on-chain derivatives trading volume has fallen for the third consecutive week, indicating a possible weakening in market risk appetite. This week's trading volume is only $5.11 billion, expected to set the lowest weekly trading volume since early 2023. Reasons for the decline in trading volumes include uncertainties over US presidential election results, escalating tensions in the Middle East region, and expectations that the Federal Reserve may not cut interest rates next month among other macroeconomic factors. Despite this, monthly average transaction volumes of on-chain derivatives markets increased by 357% year-on-year in 2024, demonstrating continuous growth of decentralized derivative markets this year. The addition of new platforms like Blast and Hyperliquid also helped expand market size. However, decentralized platform's trade volumes are still far below centralized exchanges'. For example, Binance had a trade volume of $46.2 billion in past 24 hours while total trade volume for decentralized platforms was just $5.1 billion accounting for about 11%.