Binance’s Market Share Declines Amid Regulatory And Fee Changes
According to reports, Binance’s market share on the worldwide spot market for cryptocurrencies has decreased.
According to data from cryptocurrency market data source Kaiko, Binance’s share of spot trading fell by 17 percentage points from the beginning of the year, from 90% to 73%, as reported by Bloomberg on Tuesday, July 18.
The article claims that other offshore platforms are exploiting Binance’s market exposures. The data shows that Huobi and Bybit grew to 9% and 7% of worldwide spot crypto trading volume during the same month, while OKX’s market share doubled from January to 11%.
A recent study found that Binance’s market share dropped due to stricter regulations in the U.S. The Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) took legal action against the company, contributing to the decline.
On June 5, the SEC charged Binance and its founder Changpeng Zhao with 13 offenses related to different securities laws. Charges brought by the SEC include:
Acting as unregistered exchanges, brokers, dealers, and clearing agencies.
Making unregistered offers and sales of digital assets.
Failing to prevent access to Binance.com by U.S. investors.
Deceiving investors.
In a blog post in response, Binance stated that it was “disappointed” with the SEC’s conclusion because it had united with the regulator’s queries, attempted to ease its worries, and aimed to arrange a settlement.
In response to pressure from regulators, it was reported on Sunday (July 16) that Binance has slashed staff and faced a wave of management departures.
According to Clara Medalie, director of the investigation at Kaiko, the termination of Binance’s zero-fee trading programs also hurt the company’s market share.
According to a March report from Seeking Alpha, when Binance discontinued most of its zero-fee trading, its trade activity fell to its lowest level during the weekend since July 2022.
According to a Bloomberg study, Another aspect that affects market share in the global cryptocurrency spot market is that OKX, Huobi, and Bybit, competitors of Binance, typically serve the Asian market and have profited from a more helpful regulatory environment in Hong Kong.
According to Medalie’s report. “Ever since Hong Kong loosened digital asset restrictions, the exchanges have taken advantage of the friendlier regulatory environment,”
