Exchanges Go Mainstream Centralized exchanges (CEXs) have played a critical role in the development of the crypto industry. They provide the core infrastructure for cryptocurrency trading and discovery, and are the cornerstone of the entire crypto space. As the earliest entrants with clear business models, CEXs quickly evolved into large institutions employing hundreds or even thousands of employees. Their efforts to expand user base have significantly boosted the adoption of cryptocurrencies. The crypto exchange model has evolved through multiple stages. Initially, it was simply an electronic upgrade for over-the-counter (OTC) trading. With the boom in Web3 projects and altcoins, exchanges capitalized on the surge in trading demand and transformed into professional-grade platforms. Subsequently, they added features such as lending and hedging to meet the needs of professional traders. However, CEX growth now faces both challenges and opportunities. On the one hand, the native crypto community has reached near saturation, resulting in a slowdown in user acquisition in recent years. At the same time, innovations in decentralized exchanges, such as the Meme coin issuance platform and advanced DEXs like Hyperliquid, are diverting users. These offer a similar experience to CEXs but with greater transparency. This forces exchanges to integrate self-custodial wallets with DEX trading to retain native users. On the other hand, a massive opportunity for incremental users is emerging. The new US administration's pro-crypto stance, the devaluation of the US dollar, and the adoption of stablecoins driven by geopolitical competition are fueling a new wave of mass crypto adoption and on-chain trading. This means a double increase in new users and tradable assets. Exchanges can leverage advantages like 24/7 trading, perpetual contracts, and global access to compete with traditional brokerages and attract mainstream users. According to the technology adoption lifecycle theory, we are transitioning from "early adopters" (Phase 2) to "early mass market" (Phase 3). Over the past five years, native crypto users and "degenerates" have driven exchange growth. Today, the early mass market—those who adopt innovations only after clear benefits become visible—will become the new engine of growth. To accommodate this shift, exchanges are evolving from centralized or decentralized exchanges to fully integrated exchanges (UEXs). We can further predict that, driven by the "late mass market," the second half of growth will primarily rely on exchanges, which will become the primary gateway to the on-chain world. Mainstream users may not require complex trading functionality, but they do require financial services such as payments, deposits, and returns. With their existing wallet and custody services, as well as strong organizational capabilities, exchanges are well-positioned to become the unified entry point for on-chain services. In its early stages, crypto activity was primarily driven by tech enthusiasts and miners. They were the first to experiment with new tools and quickly adopted trading, token sales, and payment use cases. Forums and OTC chat groups were the primary venues for trading. BitcoinMarket, launched in March 2010, was the first exchange to focus on crypto assets. Mt. Gox subsequently emerged, handling over 70% of all Bitcoin transactions at its peak in 2013. In 2013, Bitcoin's price began to rise, garnering media attention. Demand for secure and convenient Bitcoin-to-fiat currency conversions grew. While OTC trading still worked, it was slow and risky. More centralized exchanges began to emerge, offering order books and custodial services, freeing users from having to handle transaction details themselves. The 2017 ICO boom saw a surge in new tokens. Traders needed better tools to keep up. Exchanges became the preferred venue, and users began experimenting with more complex strategies like hedging and leverage. To support this demand, exchanges introduced perpetual contracts and margin trading. By 2020, with falling US interest rates, more investors began to look into crypto. They saw opportunities and sought professional tools to manage their assets. At the same time, DeFi projects and emerging narratives maintained high liquidity, attracting more sophisticated investors. As retail investors and early adopters drove demand, professional market makers and trading firms followed suit. Intensified competition forced exchanges to evolve to support more complex strategies, adding structured products and wealth management yields. Users enjoyed a trading experience increasingly resembling that of traditional markets, equipped with the full suite of tools needed to navigate the rapidly evolving world of crypto. From Early Adopters to the Mass Market: Slowing Growth Following a surge in 2020 and 2021, exchanges entered a period of slowing user growth. Early adopters had already entered the market, viewing crypto assets as a new investment frontier, but this was not enough to convince the broader public. The collapse of FTX and Luna pushed the industry into a "crypto winter" in 2022, with impacts lasting until the end of 2023. During this period, exchange user growth stagnated. Early adopters had largely joined, while the early majority remained on the sidelines, awaiting more concrete returns before deciding whether to participate. This stagnation was particularly pronounced among the leading platforms. For example, Coinbase's monthly active traders have remained between 8 and 9 million since 2021. Growth driven by new token issuance or narratives has almost disappeared. This slowdown highlights the urgency for exchanges to expand their functionality and reach a wider audience. Meanwhile, the rise of decentralized exchange (DEX) token trading, particularly the popularity of meme coin issuance platforms, has attracted more risk-averse users away from centralized exchanges, retaining more liquidity and users on-chain. Meme coin platforms like Pump.fun have become a hot topic in 2024. On-chain launchpads not only make the creation of new tokens extremely easy but also increasingly tie everything to tokens. Platforms like Zora tokenize every piece of social content, converting social traffic directly into token transactions. During this slow growth phase, leading exchanges focused on cultivating their existing user base and maintaining user engagement through on-chain and on-exchange activities. They primarily adopted three strategies: building an on-chain ecosystem, promoting self-custodial wallets, and integrating DEX token trading into wallets and exchanges. Public Chains and Ecosystem Development Many exchanges have launched their own public chains and platform tokens. These public chains help exchanges retain crypto-native users familiar with on-chain functionality, while the exchanges themselves serve a broader audience. Tokens serve as a bridge between the on-chain ecosystem and the exchange's user base. This model also allows exchanges to integrate token issuance activities with listings, supporting more innovative marketing and ecosystem development. Take BNB Chain, for example, which is the core of Binance's on-chain layout. The Meme Rush page in Binance Wallet is powered by BNB Chain, allowing users to trade newly issued meme tokens directly on the on-chain meme launchpad, Four.Meme. Meanwhile, the BNB token itself plays a core role in connecting exchanges and the blockchain. Users can stake BNB in Binance's Launchpool event and participate in new token issuances on PancakeSwap through the Binance MPC wallet. Over the past year, BNB Chain's monthly active users have doubled from 1 million to over 2 million, daily trading volume has jumped from 1 million to 10 million, and DEX activity has increased from 120,000 daily transactions to over 200,000. These figures reflect that as on-chain functionality matures, exchange integration is driving stronger user adoption and deeper ecosystem interaction. Furthermore, exchanges are also beginning to explore integration with social platforms. Coinbase's Base App is an example. On February 5, 2025, it integrated Farcaster, allowing users to post directly within the app and tap into Farcaster's social network. This likely brought millions of new users to the Base App. Zora subsequently introduced content tokenization within the app, allowing the creator economy to be more directly integrated into the exchange ecosystem. Decentralized Wallets With the development of decentralized exchanges (DEXs), centralized exchanges (CEXs) have gradually pushed on-chain products to the forefront, with wallets and the blockchain ecosystem becoming key entry points. Decentralized wallets serve as a direct gateway to Web3, allowing users to manage assets, explore dApps through an integrated "app store," and gradually participate in on-chain activities through token incentives. In recent years, crypto wallets created by exchanges have often unified accounts across multiple blockchains, facilitating smoother fund transfers and cross-chain exchanges. They not only support spot and meme coin trading but also integrate staking and DeFi earning features, enabling efficient asset management. Furthermore, a task-based reward mechanism encourages users to explore new features and engage more deeply with the ecosystem. OKX Wallet is a prime example. Initially focused on multi-chain asset management, it has gradually expanded to over 150 blockchains, eliminating the need for multiple wallets. Regarding security, its use of multi-party computation (MPC) enhances on-chain staking, token swaps, NFT trading, and DApp usage, gradually forming a complete Web3 ecosystem. Regarding trading and earning, it supports spot, staking, and meme coin markets, all accessible directly within the wallet. OKX Wallet also launched the DeFi Earn product. To increase user engagement, OKX Wallet has introduced task-based incentives, such as Crypto Quests and interactive trading challenges, allowing users to earn rewards by completing tasks, thereby deepening their usage. Integrating DEX Trading: In the first and second quarters of 2025, several exchanges launched on-chain trading functionality. Users can trade on-chain assets directly through their CEX spot accounts, without having to understand complex on-chain concepts or pay gas fees. This design is particularly attractive to "degens" because it allows them to access a wider range of on-chain assets on the same platform. Exchanges that have launched similar features include:
Binance (assets are selected by the listing team)
OKX (assets are selected by the listing team)
Coinbase (supports all on-chain assets on the Base chain)
Bitget (supports ETH, SOL, BSC, all on-chain assets on the Base chain)
Binance, for example, has named this feature Binance Alpha, allowing users to access high-potential early-stage projects without leaving Binance. To ensure quality and growth potential, Binance's listing team carefully selects tokens for listing on Alpha. Furthermore, users earn points by using Alpha tokens to trade or provide liquidity on PancakeSwap. These points then determine user eligibility for new Binance Alpha project events, creating a continuous incentive loop that encourages user exploration and participation in emerging tokens. This strategy has driven rapid adoption of Binance Wallet. By December 2024, when the revamped Binance Wallet launched, PancakeSwap's average daily trading volume was approximately $800 million, while Binance Wallet's was approximately $5 million. PancakeSwap has approximately 48,000 daily active traders, while Binance Wallet has only 8,500, with penetration rates of 17% (traders) and 0.7% (trading volume), respectively. By August 2025, PancakeSwap's average daily trading volume will have increased to $3 billion, while Binance Wallet's will have reached $1.4 billion. PancakeSwap's average daily active traders will be 53,900, while Binance Wallet's will be 21,400, with penetration rates exceeding 40%. Meanwhile, features like AI-assisted trading are being continuously introduced, driving user growth. For example, Bitget launched GetAgent, an AI trading assistant. Users can communicate with the AI to analyze tokens, obtain trading signals, and build strategies, all within the same app. While these efforts continue to generate new growth, the true large-scale user growth curve (the next S-curve) remains to be unlocked. As of the second quarter of 2025, only 6.9% of the global population holds cryptocurrency, while 15–30% participate in stock trading. A New Direction In early 2025, a change in the US government shifted its stance from anti-crypto to pro-crypto. SEC Chairman Paul Atkins announced Project Crypto, introducing a series of pro-crypto regulatory policies. This move aligns with the Trump administration's goal of establishing the United States as a global hub for crypto. This policy change not only boosts the confidence of native crypto users but, more importantly, allows traditional financial institutions to explore crypto as a new channel for financial services. A growing number of real-world assets (RWAs) are being brought online, including money market funds, private credit, gold, stocks, and even shares of private companies. For crypto exchanges, these on-chain assets create an opportunity to compete with traditional brokerages, attracting users familiar with stocks but yet to enter crypto. Exchanges already have inherent advantages in 24/7 trading, unlimited geographic restrictions, and perpetual contracts. Tokenized RWAs can also unlock illiquid assets, such as private company shares, expanding accessibility for investors. Combined with other traditional on-chain assets (debt, stocks, and money market funds), crypto exchanges can offer a superior trading experience to traditional markets, bringing these assets to a wider investor base. Mutual Penetration: In 2025, crypto exchanges will launch more assets and features targeting traditional financial users, lowering the entry barrier for mainstream users. On the asset side, crypto exchanges have launched tokenized stocks and RWA-backed products. For example: Binance and Bitget launched tokens backed by money market funds: RWUSD and BGUSD, respectively. Bitget has also launched stock tokens and partnered with Ondo Finance to enable users to trade directly without a traditional brokerage account. Ondo Finance's tokenized stock market already supports over $180 million in assets, with over $190 million in minting and redemption volume. By offering services comparable to or even superior to traditional brokerages, crypto exchanges have taken a lead and provided global accessibility. Leveraging the Advantages of On-Chain Trading Compared to traditional financial platforms, crypto exchanges have expanded their asset coverage primarily through two approaches: perpetual stock swaps and the tokenization of private company shares. In traditional stock markets, trading is subject to clearing requirements and leverage limits. For example, Regulation T in the United States caps margin borrowing at 50% of the stock price, which translates to approximately 2x leverage. Portfolio margin accounts offer higher leverage, sometimes reaching 6x-7x, depending on risk profile. Traditional exchanges also have limited trading hours. For example, Nasdaq's trading hours are Monday through Friday, from 9:30 AM to 4:00 PM (ET). While pre- and after-hours trading exists, liquidity is limited and volatility is high. Crypto exchanges overcome these limitations, though they may operate in a legal and regulatory gray area. Users can trade perpetual stock contracts on crypto exchanges at any time and with higher leverage. For example, MyStonks offers perpetual stock contracts with up to 20x leverage, while Bitget currently supports up to 25x leverage. These setups provide investors with global access and flexibility unmatched in traditional markets. Private Company Shares Another innovation on crypto exchanges is the tokenization of private company shares, allowing retail investors to participate. In contrast, the private equity market in traditional finance remains limited to institutional or accredited investors, with high barriers to entry and limited liquidity. Exchanges that allow users to trade tokenized versions of private company shares introduce price discovery mechanisms and secondary market liquidity to these assets. For example, Robinhood recently opened retail access to OpenAI's private equity. However, such products remain limited in widespread adoption due to legal and regulatory restrictions. Traditional Players Catch Up As crypto-native exchanges expand into traditional assets, traditional exchanges and brokerages are also striving to narrow the gap with the crypto world. Robinhood is a US financial services company known for its commission-free stock trading platform, which emphasizes a simple interface and low barriers to entry. Building on this philosophy, Robinhood has also expanded into the crypto market, allowing users to buy, sell, and hold major crypto assets such as Bitcoin, Ethereum, and Dogecoin. The platform also features a crypto wallet that supports the sending, receiving, and storage of assets. It is also launching staking features for Ethereum and Solana, allowing users to earn returns directly within the app. Robinhood is further expanding into Europe, offering over 200 tokenized US stocks and ETFs. These tokens are tradeable 24/5, with dividends paid directly into the app, and no commissions or spreads charged. To support tokenization and seamless trading, Robinhood is building Robinhood Chain, a second-layer blockchain based on the Arbitrum technology stack. Tokenized shares will initially be issued on Arbitrum, with plans to migrate to Robinhood Chain in the future, providing users with greater control, improved security, and a more integrated experience across traditional and decentralized finance. The launch of Robinhood Chain also opens up new possibilities for the platform: attracting liquidity outside of Europe and connecting users around the world to their tokenized assets. In July 2025, PNC Bank announced a strategic partnership with Coinbase to enhance digital asset services for clients. Through Coinbase's Crypto-as-a-Service (CaaS) platform, PNC will provide clients with secure and scalable crypto trading and custody solutions. This will allow PNC clients to buy, sell, and hold digital assets directly within the bank's interface. PNC will also provide certain banking services to Coinbase, demonstrating both parties' commitment to building a more robust digital financial system. While the crypto market has long operated 24/7, some stock exchanges are also beginning to follow suit. In March 2025, Nasdaq announced it would introduce 24-hour trading on its main U.S. board to meet the growing global demand for around-the-clock U.S. stocks. The Next Era: Universal Exchanges and Gateways to the On-Chain World Combining current development trends, we can see two major evolutionary directions for exchanges: Universal Exchange (UEX) – a platform open to everyone, trading all assets. It serves both native crypto users and mainstream users, regardless of geography or time. Gateways to the On-Chain World – building super-apps that connect users to the broader crypto ecosystem through everyday on-chain services like payments, and incubating a vibrant on-chain application ecosystem. As CEXs seek to serve both crypto-native and mainstream users, they are expanding from single trading platforms into complete ecosystems. Bitget's "UEX" concept embodies this trend. A key component of this is the integration of DEX tokens. Features like Binance Alpha and Bitget Onchain allow users to access tokens previously limited to DEXs within the exchange. Exchanges are also expanding the range of tradable assets. For example, Zora tokenizes social media posts, bringing the creator economy directly into the exchange interface. Meanwhile, pro-crypto policies in the United States are accelerating the on-chain integration of real-world assets. Money market-backed tokens, tokenized stocks, and even private company shares are now tradable on platforms like Binance, Bitget, and Robinhood. Exchanges have an advantage over traditional brokerages due to their global reach and 24/7 trading. All of this allows more people to enter the crypto world. By combining DEX tokens, emerging assets, and tokenized real-world assets, exchanges are building a unified platform that serves both newcomers and established users. A Gateway to the On-Chain World With the implementation of pro-crypto policies, stablecoins are rapidly developing, with domestic and international issuers entering the market. Banks issue stablecoins to secure liquidity, while marketplaces use them to attract capital and business. Exchanges play a key role in distribution, such as USDC on Coinbase or USDT on various platforms. Simultaneously, exchanges and wallets are also building payment and transfer infrastructure. For example:
OKX Pay — Based on the X Layer, it offers zero-gas payments and doesn't require holding OKB;
Bitget Wallet PayFi — Supports QR code payment networks in countries like Vietnam and Brazil, allowing users to spend directly with stablecoins.
As these systems mature, stablecoins are becoming part of everyday transactions. However, since holding stablecoins yields no returns, users are seeking interest-bearing options, giving rise to the demand for "crypto banks." Binance, OKX, and Bitget have all integrated DeFi yields and RWA-backed assets into their wallets, allowing users to earn returns while retaining their funds.
This is similar to the traditional financial model: Alipay first attracted users with payments, then added wealth management products; Ping An started with insurance, then expanded into comprehensive finance. Crypto exchanges are also integrating payments, deposits, and returns. Some are positioning themselves as full-service exchanges, while others are developing into super-apps (such as the Coinbase Base App), integrating payments, social networking, mini-apps, and tokenized content (Zora and Farcaster). By integrating trading, payments, and content, exchanges are gradually becoming hubs in the ecosystem. Projects can directly reach users, tokens circulate within the app, and AI tools assist in trading decisions—all of which lower the barrier to entry and deepen user engagement. Summary: Current trends suggest that the driving force behind exchanges' evolution into Panorama Exchanges stems from three key factors: the convergence of CEX and DEX trading; the "tokenization of everything" driven by Launchpad; and the Trump administration's push for real-world assets to be on-chain. Exchanges' transformation into UEXs aims not only to capture on-chain innovation but also to attract mainstream users who are in the "early majority" stage. After Panorama Exchanges attract the early majority, this "gateway to the on-chain world" will bring the "late majority" into crypto. These users don't require complex trading functionality, but they still value convenient financial services like payments, deposits, and returns.
These two paths together define the next phase of growth: expanding from early enthusiasts to a broader audience, positioning exchanges as the primary entry point to the on-chain ecosystem.
However, while the concepts of panoramic exchanges and on-chain portals hold immense potential, their realization is not easy. Mainstream adoption still relies on exchanges building trust and reliability. Regulatory barriers add complexity, with licensing requirements varying across jurisdictions and potentially prohibiting integrated financial services and requiring business segregation. Despite these challenges, the trend continues to propel exchanges toward this ultimate goal—even if not all exchanges can achieve it individually.
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