Given the ongoing regulatory issues it is experiencing in the United States, it’s not altogether surprising to see that Binance‘s spot market share has reportedly fallen for a seventh consecutive month, with its share slipping from 38.5% in August to 34.3% in September. Going back a bit further, in January 2023 it stood at as much as 55.2%. This isn’t the only market wherein Binance seems to be losing ground though, with the derivatives market also showing a drop in the exchange’s dominance from 53.5% in August to 51.5% in September. At the start of the year, it accounted for more than 62%.
It might seem easy to point the finger at the US regulatory concerns as the main reason behind the fall, but CCData research analyst Jacob Joseph sees things a bit differently. According to him, Binance‘s decision to put a stop to its zero-fee trading promotion for major trading pairs has played an equal if not larger part in the reduction.
Aside from this, it’s also worth noting that Binance had to wrap up its operations in certain key markets this year. For instance, in September, the exchange fully exited Russia by selling its entire local business to a newly-founded entity known as CommEx exchange. This was a noteworthy move given that Russian visitors accounted for nearly 7% of the platform’s traffic.
Another notable change that could have influenced things was the alteration of its trading fees in early September, wherein it decided to apply a regular taker fee based on the user’s VIP level. For instance, regular users on Binance now have to pay a 0.1% taker fee on spot and margin trades.
As for what happened to Binance’s lost spot trading volume, it seems to have found a home elsewhere with exchanges like HTX (formerly Huobi), Bybit, and DigiFinex taking up the slack. Exchanges such as OKX, BitGet, and Bybit have reportedly managed to snag a healthier market share in derivatives too. Ultimately, it seems clear that while much of the market shift can be attributed to Binance‘s internal strategy changes and regulatory challenges, this has also created new opportunities for other players in crypto exchange space.
Source: Cointelegraph
