Binance’s Spot Market Share Continues to Decline
Binance, the world’s leading cryptocurrency exchange, has seen a decrease in its spot market share for the seventh consecutive month. According to data from CCData, Binance’s spot market share dropped from 38.5% in August 2023 to 34.3% in September 2023.
CCData reported that the trading platform lost its spot trading volume to other cryptocurrency exchanges such as HTX (formerly Huobi), OKX, Bybit, Bitget, and DigiFinex.
Declining Trading Volumes and Market Share
In addition to the decline in spot market share, Binance also experienced a 57% decrease in its 7-day trading volume for Bitcoin (BTC) since early September. The platform’s market share in derivatives also fell from 53.5% to 51.5% in August.
Since the beginning of August 2023, approximately 12,230 BTC ($330 million) and 198,200 Ethereum (ETH) ($323 million) have been withheld from Binance.
Reasons Behind the Decline
One of the major factors contributing to Binance’s decline in spot market share is the end of a zero-fee promotion activity that took place in September. While the promotion initially boosted trading activity on the platform, its discontinuation led investors to seek alternative platforms.
“The halting of zero-fee trading promotion for popular trading pairs, combined with concerns about regulatory scrutiny on the exchange, has contributed to this decline,” said Jacob Joseph, a research analyst at CCData.
Closure of Zero-Fee Promotion
Binance’s zero-fee promotion came to an end in September 2023. The discontinuation of this promotion is believed to have played a role in the decline of Bitcoin trading volume on the platform.
On September 7, Binance discontinued a promotion that allowed users to trade freely between Bitcoin and the TrueUSD stablecoin, resulting in a decrease in market share and volume on the platform.
Hot Take: Binance’s Declining Spot Market Share Raises Concerns
Binance’s continuous decline in spot market share is a cause for concern. The end of the zero-fee promotion and regulatory scrutiny on the exchange have contributed to this decline. As investors seek alternative platforms, Binance will need to address these issues and regain market confidence to reverse the downward trend in its spot market share.
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