Cryptocurrency exchange Binance has experienced a loss in market share after it ended its zero-fee Bitcoin (BTC) trading. According to a report by CCData, the exchange market share has continued to slide for the second consecutive month, to 46.3%, marking Binance’s lowest percentage of market share since October 2022. This decrease follows Binance’s decision to end its zero-fee BTC trading promotion for most BTC trading pairs.
A representative from Binance spoke about the situation, stating that the company forecasted the drop in market share once they ended their promotion, but it is not a concern for them. They emphasized that Binance continues to maintain its strong financial performance and, at present, their goal is to cater to users through new and existing products while investing in compliance processes for a new era of regulatory certainty.
Prior to the market share drop, Binance controlled over half of the market share, with some numbers as high as 57.5%. Additionally, the reported revealed that spot trading on Binance fell by 48.1% to $287 billion in April. While the next largest exchanges, Coinbase and OKX, make up only 5.60% and 5.39% of the total spot trading market, smaller exchanges have been gaining momentum. For example, Upbit currently accounts for 4.77% of the market share compared to 2.81% at the start of 2023.
Binance’s spokesperson expressed that the company welcomes and encourages competition as it drives innovation and is healthy for the industry. These developments come as Binance experiences other changes in its operations aside from ending zero-fee BTC trading. On May 12, the company announced that it has decided to end its operations in Canada, citing new regulations. Shortly after that announcement, reports began to surface about Binance’s plans to lay off 20% of its workforce this June, contradicting previous statements that they did not have any layoffs planned.
In conclusion, Binance’s market share drop may not be alarming for the company itself, but it certainly highlights the ever-changing landscape of the cryptocurrency exchange market. As smaller exchanges gain momentum and competition grows, we can expect further shifts and developments in this sector moving forward.
Source: Cointelegraph
