Binance Loses Market Share to Coinbase and Bybit After Settlement

In a recent turn of events, Binance, the global cryptocurrency giant, suffered a significant shakeup as its CEO and co-founder, Changpeng Zhao, stepped down following admissions of violating US anti-money laundering regulations. The aftermath saw Binance agree to pay over $4 billion in fines without admitting guilt, leading to a ripple effect across the crypto market.

The incident triggered a mass migration of investors seeking refuge in alternative platforms, with Coinbase Pro and Bybit emerging as the primary beneficiaries, according to a comprehensive report by Kaiko, a leading crypto data provider.

Coinbase Pro, Binance’s US-based rival, witnessed an impressive 34% surge in market share in the days post-settlement. Simultaneously, Bybit, a Singaporean derivatives exchange, experienced an even more substantial boost, boasting a remarkable 50% increase in its market share.

Binance Is Still the Leading Crypto Exchange

Despite these challenges, Binance remains resilient. Kaiko’s analysis highlights that Binance continues to lead in liquidity for both Bitcoin (BTC) and altcoins. CryptoQuant’s on-chain data further substantiates this claim, revealing that Binance still holds a substantial reserve of around 500,000 BTC, down from 634,000 in May.

Interestingly, Kaiko emphasized that Binance’s dominance extends to specific altcoins, especially Dogecoin. The report underscores that Binance maintains the lowest spreads for DOGE, showcasing its strength in market stability compared to competitors Bybit and Coinbase, which exhibit higher and more volatile spreads.

“It’s too early to make sweeping predictions, but early trends look far from dire for Binance, while also promising for Coinbase and Bybit. This competition developed an interesting wrinkle this week in the form of an email from Coinbase to customers, which informed them that Coinbase received a subpoena from the CFTC related to Bybit,” Kaiko concluded.