Binance's Market Share Dips Amid Regulatory Challenges and Strategic Shifts
Summary:
Amid ongoing regulatory challenges in the United States, global cryptocurrency exchange Binance has seen its market share decline for the seventh month in a row, dropping from 38.5% in August to 34.3% in September 2023. This trend is also observed in the derivatives market, with a downfall from 53.5% to 51.5% during the same period. In addition to regulatory issues, the cessation of Binance's zero-fee trading campaign also contributed to this decline. The recent withdrawal from the Russian market and restructuring of trading fee policies are other notable developments concerning Binance.
In the midst of persistent regulatory issues in the United States, Binance, a leading global cryptocurrency exchange, continues to experience a significant decline in its market share. Analysis from the cryptocurrency data provider CCData, reported by Bloomberg on October 5, 2023, indicated that in September alone, Binance's pie of the spot market was reduced for the seventh month in succession, falling from 38.5% in August to 34.3%. In contrast, this figure stood at an impressive 55.2% in January 2023.
In addition to the spot market, Binance has also seen a dip in its derivatives market share. The report shows a drop from 53.5% in August to 51.5% in September. At the start of the year, Binance held more than 62% of this market.
Jacob Joseph, a research analyst at CCData, suggests that Binance's declining market share cannot solely be attributed to US regulatory hurdles, but also to the halting of its zero-fee trading offer for significant trading pairs.
The contraction in Binance's market presence also coincides with the company ceasing operations in some key markets this year. For instance, as of September, Binance has fully exited Russia and sold its entire local business to a newly established exchange known as CommEx, originating from undisclosed sources. Russia played a major role in Binance's visitor base, with about 7% of site traffic being Russian.
In the early days of September, Binance modified its trading charge structure, reintroducing a standard taker fee dependent on the user’s VIP level. For instance, non-VIP users were charged a 0.1% taker fee on spot and margin trades.
The report reveals that Binance’s lost spot trading volume has been shared across exchanges like HTX (formerly Huobi), Bybit, and DigiFinex. Competing exchanges, including OKX, Bybit and Bitget, have also seen a slight increase in derivatives market share.
Published At
10/6/2023 11:27:10 AM
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