Binance Market Share Slumps Despite Bitcoin Rally

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Amidst the ongoing cryptocurrency rally, the market share of Binance continues to experience a consistent decline.

Binance Market Share Down to 50%

Based on information from The Block‘s data dashboard, Binance’s market share among exchanges that do not facilitate trading in USD has dropped from 74% in December 2022 to 50% in the current month.

Bitcoin’s Upward Trend

The traders’ withdrawal from Binance was notably conspicuous on October 23. During a period when Bitcoin was experiencing an upward trend, Binance’s market share nearly plummeted to zero, mirroring Bitcoin’s ascent to $34,000. In a contrasting scenario, data from Kaiko revealed that OKX’s market share exceeded 50%, which is a remarkable and uncommon occurrence.

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“It is tough for institutional guys to commit resources given the headline risk,” noted one trading executive in the crypto options space. “HFT guys have outsized volume due to the nature of the trading style.”

Binance Spot Volume Sees a 7-Month Decline

It is noteworthy to mention that by September, Binance’s market share in the spot trading sector had experienced a continuous decline for seven months in a row, settling at 34.3%. In contrast, in January, Binance’s market share in the spot trading segment was well over 55%. This decline in trading volumes has had a direct and adverse effect on the exchange’s profitability.

Moreover, in a recent development, it has been reported that Changpeng ‘CZ’ Zhao’s net worth has taken a massive hit, plummeting by $11.9 billion. This decline can be directly attributed to the decreasing trading volumes on his exchange. 

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CZ’s Net Worth also Declined

Just last Thursday, the Bloomberg Billionaires Index dealt a severe blow to CZ and Binance by reducing Binance’s revenue estimates by a substantial 38%. This adjustment reflects a significant decrease in trading activity on the exchange.

In addition, the company is currently facing legal scrutiny from both the Commodities Futures Trading Commission and the US Securities and Exchange Commission. This situation has prompted apprehension among several trading firms, causing them to reduce their trading operations on the platform.

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