Insights from an Etherscan Newsletter Poll: Exchanges
By: Harith Kamarul
Tags: Surveys, Exchange, Ethereum, Block Explorer, Etherscan

Results

Our poll received approximately 1,000 responses.

Q1: How often do you trade cryptoassets on an exchange?

Slightly less than half (41%) of respondents trade on a daily basis while 29% do so on a less than weekly basis.

In contrast, a similar survey done on the r/Ethereum subreddit (albeit about decentralized exchanges) in 2019 showed the opposite trend: only 26% of respondents traded daily while 42% traded less than weekly.

Source: r/Ethereum survey of 218 users in 2019 on decentralized exchanges

One interpretation of the two surveys is that a majority of Ethereum users continue to trade on centralized exchanges as opposed to decentralized ones. Alternatively, since decentralized exchanges have shown tremendous growth in 2020, those who had rarely or never traded in 2019 may have upped their game this year!

Looking back at the first graph, a whopping 11% (almost 100 respondents!) have never traded on an exchange. A possible reason could be that they have only received crypto as payment or traded on OTC (over the counter) markets.

Q2: What kind of cryptoassets have you traded?

Note: Cryptoasset as used here refers to a broad set of asset classes that includes cryptocurrencies, tokenised real assets and DeFi products.

Slightly more than half (58%) of respondents have only ever traded cryptocurrencies, while 8% have never traded any kind of cryptoasset. The 3% difference in this answer compared to those that answered “Never” in Q1 (11%) provides a clue to the number of people who have only traded via OTC markets.

Beyond cryptocurrencies, none of the other cryptoassets have been traded by more than 20% of respondents. IEOs (Initial Exchange Offerings) were a distant second with 18%. Overall the chart shows a lot of room for adoption of other cryptoassets within the crypto space.

Despite DeFi’s explosive growth and the heavy coverage it’s received in Ethereum circles recently, it scores the lowest out of the 4 other cryptoassets listed. Only 11% (about 100) respondents have ever traded DeFi assets such as loans, sets or synthetic tokens.

The low number is a marked contrast to the 89% of respondents who have heard of DeFi from CoinGecko’s DeFi Survey. It indicates that while awareness of DeFi is high, actual adoption has plenty of space for growth past the $1.2 billion peak seen in February.

Source: CoinGecko Quarterly Report for Q1 2020

Q3: What feature would you most like to see implemented on an exchange?

The question was left open-ended so as not to bias respondents with pre-selected answers. Out of these, responses were filtered for relevance and grouped into labels. The filtered list totaled up to 423 responses, and the top 8 labels are displayed in the chart below:

The top 8 features made up 75% of requests.

Most requested was Fiat integration. A majority of these asked for support of local currencies, with responses ranging from Taiwan to Turkey. A high number also asked for credit card support, while others asked for better integration with banks and payment channels. Paypal, Mollie and MultiSafepay were three name-dropped. One cool idea that came up: could there be a publicly updated list of banks that are crypto-friendly? That would be a major public good for many buyers of crypto!

Responses grouped under Ease were primarily focused on clearer UI/UX (User Interface/User Experience) for the average user. A number of these asked for native language support, while others asked for easier verification or price alerts. One user asked for wallet address validation during withdrawals (automatically block a transaction if the address is missing a character or if the wallet has never been created); another asked for the wide use of methods such as Telegram passports for KYC verification.

Speed and Low fee responses were straightforward, asking for these both in terms of trades and deposits/withdrawals.

Advanced orders & products refer to requests for implementation of orders such as stop loss, take profits, trailing orders and OCO (One-Cancels-the-Other) orders, and products such as leverage & margin trading, futures, swaps, options and synthetic assets. One respondent asked for an IFTTT (If This Then That) feature to arrange multiple buy and sell orders triggered in a set order.

More Exchange pairs between tokens were also asked for. A small number even asked for directly exchanging tokens with stocks and commodities!

Some users were looking for ways to Earn through their exchange. Suggestions include staking their coins (for POS blockchains), lending with interest and by completing online activities. Obligatory reminder: over-consolidation of staking in a small number of service providers adds more risk to the entire system.

Rounding off the top 8 is Security. Most responses plainly asked for good security of exchanges; one asked for insurance on their deposits while another asked for fingerprint recognition as part of 2FA (two factor authentication).

Out of the remaining 25% of labeled responses, these covered topics such as learning resources, promotions, integrations with DeFi and decentralized services, automation, P2P (peer to peer) trading and analytics tools.

Stand out suggestions from these include:

Naming of a will for holdings on an exchange

Login via web3

Purchasing crypto via mobile credit, and purchasing goods via crypto on the exchange

Tutorials for first time user

VPN (virtual private network) service

Allow trading via API

These responses were largely consistent with that from a similar survey done in 2019. Some exceptions include mentions of advanced products (futures, swaps) and ways to earn in this poll. The differences could be due to a more targeted segment in this one.

Source: BDCenter Digital survey of crypto traders

Lastly, while 88% of exchanges want more industry regulation, only 2 respondents specified regulation as a feature to be implemented.