Binance's share of the crypto market decreased by 16% in the first quarter of 2023
Binance crypto exchange's market share shrank 16% in the first quarter of 2023
Changpeng Zhao's crypto exchange remains the leader in terms of trading volume, despite its market dominance shrinking following a lawsuit by U.S. regulators and the cancellation of zero commissions
Binance's share of the crypto market declined 16 percent during the first quarter of the year, according to data from the analytics platform Kaiko. The report said that the leading crypto exchange's share of the spot market declined due to the U.S. Commodity Futures Trading Commission (CTFC) lawsuit and the cancellation of zero commissions on Binance for a number of trades.
A January CryptoCompare report showed that Binance had a 66.7% share of the crypto market at the end of 2022. Binance has led in trading volume for the past few years, and the elimination of trading fees and the collapse of its competitor, FTX, led to an overflow of users to Binance late last year.
Beginning March 22, 2023, Binance eliminated all zero fees in bitcoin trading pairs with the exception of the TrueUSD stablecoin. Prior to that, since June 2022, the platform did not charge fees in 13 pairs such as BTC/USDT, BTC/BUSD, BTC/USDC, BTC/EUR, and BTC/TRY. Kaiko analysts previously reported that as of mid-March 2023, zero-commission transactions on Binance accounted for the majority of the exchange's trading volume - 66%.
On March 27, the CFTC filed a lawsuit against Binance alleging that the exchange was actively working with U.S. investors, including institutional and VIP clients, without the right to do so. According to the commission, Vipanse also ignored legal regulations.
Kaiko analysts noted that a significant loss in Binance's market share occurred in the last two weeks of March. Nevertheless, Changpeng Zhao's cryptocurrency exchange is still the largest in the world with a market share of 54 percent, according to the report.
The study notes that Binance.US, which has the right to operate in the U.S. despite a lawsuit against the main exchange, tripled its market share from 8 percent to more than 24 percent. South Korean exchange Upbit also increased its share by the end of the first quarter, while U.S. competitor Coinbase's share declined.
On March 14, the total trading volume on 18 of the most liquid centralized crypto exchanges rose to $51 billion for the first time in four months.
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