Binance dominates the crypto exchange market with a 61.8% share despite widespread R&D
A new report from CryptoCompare, a crypto market data provider, reveals that Binance’s market share rose from 59.4% in January to 61.8% in February.
Binance, the world’s largest centralized crypto exchange, saw an increase in its spot volumes, reaching a record market share with a 13.7% increase to $504 billion, the report also found.
Second only to Binance in trading volume, Coinbase saw $39.9 billion traded in February, down 29% from the previous month. Kraken came in third, with $19.3 billion in revenue, down 11%.
Binance’s market share across derivatives exchanges grew to 62.9%, the highest monthly market share ever recorded for the exchange. OKX and Bybit followed with 14% and 13.3% market share respectively.
Why is Binance dominating so hard?
Binance’s introduction of zero-fee Bitcoin trading is a significant contributing factor.
In July 2022, to celebrate its fifth anniversary, Binance declared zero fees on 13 Bitcoin spot pairs. Since Bitcoin represents a significant portion of the crypto market’s trading volume, the elimination of fees on BTC trading had a significant impact on the overall dominance of spot trading volume.
Despite the bear market, Binance is intensifying its global expansion efforts. It recently registered as a financial services provider in New Zealand and has also registered in France, Spain and Italy markets such as South Korea and Japan. This global expansion is likely to have resulted in an influx of new traders to the exchange, thereby strengthening its dominance in trading volume, analysts believe.
Still – lots of ongoing R&D against Binance
But with news that regulators in the US and other countries are beginning to intensify their scrutiny of the exchange, fear, uncertainty and doubt continue to surround Binance.
Changpeng Zhao, co-founder and CEO, said in a recent Twitter AMA on March 9 that as volume increases, the exchange’s focus is becoming more on product development, refinement and education.
“We will continue to focus on product development,” CZ said during the AMA. “Protect users. Build and build,” he later tweeted.
However, on March 5, an article was published in the Wall Street Journal that purported to reveal internal Telegram messages from the CEO that suggested Binance was more closely tied to Binance.US than previously disclosed.
In response, CZ last week tweeted “4” – referring to an earlier tweet reminding its 8.2 million followers to “ignore FUD, fake news, attacks, etc.”
The 4 quickly became a meme on crypto Twitter, with users uploading pictures of themselves holding up four fingers.
TheFUD “just gives us more exposure and more publicity. Most users are very smart today and we actually only want the smart users on our platform,” CZ said, “the people who believe in FUD, we actually probably don’t want these users on our platform.”
Binance continues to seek Voyager customers
In a March 9 Twitter AMA, CZ said he and Binance remain committed to seeing the deal for Voyager go through.
“We remain committed to Voyager and very committed to going to that agreement and helping the users there,” he said.
However, CZ also revealed that Binance had scaled back on some commitments, citing the US as having a more negative industry outlook in terms of regulatory clarity and adoption stance.
“I think the United States this year is not looking good.”
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