Binance loses market share - competition catches up

Binance's ambitious efforts for market consolidation do not yet seem to have fully borne fruit. Once the world's largest crypto platform, it recorded the lowest share of trading volume in September in four years in the approximately two trillion dollar digital asset market. Recent data from research firm CCData shows that Binance's market share fell to 36.6% last month, down from 42.7% at the beginning of the year. In the spot market, the share fell to 27%, the lowest level since January 2021, while derivatives trading stands at 40.7%—also a four-year low. Since March 2023, the crypto exchange has lost market share while grappling with regulatory measures and intensified global scrutiny. Last year, it agreed with the U.S. Department of Justice and other authorities to pay a $4 billion fine for alleged sanctions violations. Co-founder and then-CEO Changpeng Zhao stepped down and spent four months in jail. The new CEO, Richard Teng, a former regulator, is now focused on engaging with global regulatory agencies. According to CCData, in September, the combined spot and derivatives trading volume across all centralized crypto exchanges fell by 17%, a seasonally typical decline, to the lowest monthly activity level since June. Binance experienced the largest drop in market share among major exchanges, according to CCData. Binance representatives were not immediately available for comment. Meanwhile, there is no standstill among the competition: smaller centralized competitors such as Bybit, Bitget, and Crypto.com have recently gained shares. Jacob Joseph, a senior research analyst at CCData, notes that this trend may be due to the growing confidence of crypto participants in other platforms that offer a comparable user experience with low trading fees, minimal slippage, and high market liquidity. Earlier this month, however, Binance made history by becoming the first centralized crypto exchange to surpass the $100 trillion mark in lifetime trading volume, according to CCData.