The largest cryptocurrency exchange Binance is beginning to lose its leading position in the market. Binance’s Spot Market Share Drops Nearly 15%, Reports The Block. However, representatives of the exchange do not care: the trading floor is quite happy with what it is.
In February, Binance’s share of the spot market was 62%, and this month it has dropped to around 47%, according to reporters. However, Binance is still the largest spot crypto exchange in the world.
Patrick Hillmann, Chief Strategy Officer of Binance, told The Block last week:
We control a significant part of the market and do not need to get more. In fact, we want more competition, which is good for the market. This is good for the industry.
The decline in Binance’s market share is driven by factors such as the exchange’s recent cancellation of zero fees for Bitcoin trading and overall low trading volumes over the past few months. “We predicted a drop in market share as soon as we ended our zero-fee bitcoin trading promotion for most trading pairs,” a Binance spokesperson told The Block. “That doesn’t bother us. We continue to maintain our strong financial performance.”
Our primary goal is to serve our users by improving our existing products and services and continuing to invest in compliance processes for a new era of regulatory certainty.
Binance offered zero fees from July last to March this year. Thirteen trading pairs participated in the promotion, including BTC/USDT, BTC/BUSD and BTC/EUR. Exchange users can still exchange bitcoins for the TrueUSD stablecoin (TUSD) for free.
The drop in market share of Binance coincided with a decline in overall trading volumes. Monthly crypto trading volumes have been below the $1 trillion mark since last October, according to The Block. Problems with regulators also contributed to the decrease in trading volumes on Binance. The U.S. Commodity Futures Trading Commission (CFTC) sued Binance and its CEO Changpeng Zhao in March. The lawsuit says that the trading platform violated the rules for trading derivatives by not attending to the appropriate registration.
But Binance’s competitors, including OKX and Coinbase, have slightly increased their market share in recent months. A Binance spokesperson expressed his joy at this.
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