The stagnation in the crypto market has discouraged newbies, but seasoned traders remain unfazed, the CEO of the EXMO cryptocurrency exchange said.

EXMO, an exchange with about $40 million in daily trading volume according to CoinGecko, has been catering mostly to traders in Russia, Ukraine, Belarus and Kazakhstan, but has been actively expanding in the U.K recently, said CEO Sergey Zhdanov. 

In June, trading activity on both spot and derivative crypto markets contracted more than 40%, a report by CryptoCompare said. 

“Retail traders who flocked into crypto in 2021 were set aback by the declining price,” Zhdanov said. “New people come with an assumption that [crypto] will be growing forever, but then it falls.”

Many new traders were drawn by Tesla CEO Elon Musk’s Twitter rants about dogecoin, Zhdanov said. That was especially notable in the U.K., where EXMO has fewer users, and so knowing who the new traders were was more apparent. 

“In January and February, when Elon Musk was tweeting [about DOGE], the first surge of interest happened. [British news outlet] Metro.co.uk wrote about it and provided a link to us, and 10,000 of new British users came, all after dogecoin,” Zhdanov said.

For the vast majority of those newbies, the pattern was simple: They bought DOGE high, sold low after the price went down, and then withdrew money and left, Zhdanov said. They did not switch to older cryptocurrencies like bitcoin or ether and instead just capitulated, he said.

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Still, 10% of those new users have remained active traders and made up about $1 million of trading volume during the last six months, Zhdanov said. This doesn’t necessarily mean that those traders invested a lot of money in crypto but rather that they made a lot of trades. They might have been using the same deposit amount to buy coins, sell them and then buy again, and so on. 

In contrast to the fresh users, more experienced traders who began before this year and had seen previous ups and downs of the market kept trading even in the days of low volatility and depressed prices, Zhdanov said. 

“Experienced traders have a longer-term strategy – even when the market is quiet, they keep buying or selling,” he said.

In any case, the first half of 2021 was better for EXMO than all of last year, according to Zhdanov. The exchange now has 1.9 million registrations, and about 100,000 users have $5 or more in their accounts. Out of the 1.9 million, 200,000 users registered this year, and 35,000 of them have actually started to trade.

And the older crowd prefers the old coins: Up to 80% of trading on EXMO is in bitcoin and ether, Zhdanov said.