Arweave TX
After a euphoric rise at the end of 2024, the crypto market greeted 2025 with high expectations — but instead of another rally, the industry faced a sharp decline. Already in the first quarter, the market capitalisation fell by 18.6%, dropping to $2.8 trillion after a short-term surge to $3.8 trillion on the eve of the inauguration of US President Donald Trump. According to CoinGecko analysts, trading activity also declined significantly, with average daily volumes falling by 27.3% to $146 billion.
The situation has been further exacerbated by Trump’s tariff hike and a potential trade war, leading to a new ‘crypto winter’. In particular, Coinbase analysts noted the transition to a bear market after Bitcoin and the COIN50 index consolidated below their 200 DMA.
The crypto market enters a bear market phase when asset prices decline significantly, usually by 20% or more from recent highs. Such downturns can be caused by various factors, including changes in regulation or market sentiment, macroeconomic events, etc. During a bear market, market sentiment turns negative, and fear and uncertainty can be the main driving forces. Investors begin to sell their assets, which contributes to an even greater drop in prices.
How do I recognise that the market is in a bearish phase?
Prices fall for several weeks or months in a row;
Sentiment changes from optimism to fear and pessimism;
Volatility increases — price fluctuations become sharp and unpredictable;
The information space is filled with mostly negative news;
Trading volumes decline, indicating a decline in interest in the market.
Against this backdrop, the need to maintain user interest in cryptocurrency exchanges is becoming particularly relevant. In particular, trading tournaments have become an effective tool for this purpose, a format that is gaining popularity among crypto platforms.
During periods of low volatility, crypto exchanges are looking for ways to stimulate user activity. One such way is through trading tournaments, which are competitions among traders aimed at achieving maximum profit within a certain period of time. These events can last from a few hours to several weeks and have clear rules, reward systems and evaluation criteria. In such tournaments, participants apply various strategies and tools for successful trading, and the winner is the one who achieves the highest performance.
The main goals of trading tournaments:
I asked one of the leading traders at TradingView to share his expert opinion on trading tournaments. According to him, trading tournaments play a very important role in today’s financial markets — especially in this Crypto era. Why exactly?
ProfittoPath: ‘These kinds of competitions are a strong source of market volume, increase money transactions, and add liquidity. That liquidity helps hedge funds, smart money, and even retail traders enter and exit with more flexibility. It has become a major source of cash flow that directly affects exchanges and token movement, and even impacts the wider financial market indirectly.
Also, tournaments improve spreads and bring more profitability for exchanges. They help retail traders engage more with brokers, and they give small traders a chance to compete with big players like market makers. With better liquidity, retailers get global exposure and the confidence to trade better.
No doubt, events like this boost capitalization for exchanges. They create momentum when the tournament happens, but sometimes, that hype brings fake or temporary demand and supply. That’s the other side of the story. It creates more exposure but also more speculation, where prices move like a bet, not a trade. Still, they bring more liquidity and visible capitalization, which is helpful for platforms and for the trading community overall.’
Which formats of trading tournaments are available?
When it comes to tournament formats, crypto exchanges can be creative, as there are many of them. In particular, the most common are the following:
Let’s take an example of tournaments that are currently taking place on crypto exchanges.
Cryptocurrency exchange MEXC organised the Celebra7eMEXC tournament in honour of its 7th anniversary. Participants were offered several competition formats to choose from: a team battle on PNL; individual competitions for volume and profitability; tasks with random rewards. This approach allows us to attract a wide audience — both experienced traders and beginners who want to try their hand at a more playful format.
Speaking of tournaments with qualifying stages and finals, it is worth mentioning the ICTC, which is currently taking place on WhiteBIT. In particular, in early April, traders competed in the qualifying round to determine the finalist. It is interesting that the decisive battles are broadcast live, so even those who do not participate can watch the strategies of the top players in real time and learn from them.
Gate.io, the crypto exchange that organised the seventh season of WCTC S7, did not stand aside. This time, the tournament’s theme is inspired by the world of racing cars, and participants have a chance to win not only a part of the prize pool but also luxurious prizes, including the legendary Ford Mustang GT. This tournament perfectly illustrates how cryptocurrency exchanges can combine traditional competitions with creative themes to create a unique atmosphere for traders.
Holding such tournaments can have a significant impact on the level of user confidence in the exchange. Trading competitions create a kind of atmosphere of transparency and equal conditions where everyone can prove themselves. Thus, the platform not only provides trading tools, but also actively supports the development of traders by creating additional opportunities for this.
Moreover, participation in such events often becomes the first step towards deeper interaction with the exchange. Users become interested in other features and products, which in the long run can increase loyalty and stimulate potential use of the platform. The more a trader interacts with the exchange, the more their trust and engagement grows.
In particular, according to ProfittoPath: ‘Trading competitions can positively impact the credibility of crypto exchanges, but their effect on reputation depends on the exchange’s overall integrity. In today’s world, where financial literacy is expanding, exchanges play a key role in educating traders about markets. Tournaments can strengthen an exchange’s standing by showcasing transparency, engagement, and skill development.
However, an exchange’s reputation ultimately hinges on its credibility, compliance, and adherence to regulations. Traders and investors assess exchanges through multiple factors — trading competitions may serve as a positive indicator, but the most critical aspects are regulatory compliance, security, and fair practices. Exchanges that follow strict rules and laws gain more trust and global credibility, while those that misuse competitions for hype risk damaging their reputation.’
When the market is down, you don’t have to go down with it. Today, cryptocurrency exchanges are demonstrating that even in a low volatility phase, it is possible to stay active with the help of well-thought-out gamified formats.
As ProfittoPath notes: ‘I have not personally participated in any trading tournaments or activities, but I have a positive perspective on them and strongly encourage exchanges to host such events. These competitions are healthy (wealth-building) activities that push traders toward a more analytical and disciplined approach to trading.
Additionally, these tournaments provide unique exposure, helping traders test strategies, improve decision-making, and gain confidence in real-market conditions. Overall, I believe they contribute positively to trade development and market education.’
Originally published at https://www.publish0x.com/ on April 23, 2025.
Vlad Hryniv
