Binance loses bitcoin trading share as rivals expand

Cryptocurrency exchanges are eating into Binance’s share of bitcoin trading outside the United States as overseas expansion efforts and changing regulations reshape the competitive dynamics of the digital asset industry.

Over the past year, the world’s largest cryptocurrency exchange saw its share of such bitcoin trading drop to 55.3 per cent from 81.3 per cent, according to research firm Kaiko. For smaller tokens known as altcoins, the proportion fell to 50.5 per cent from 58 per cent.

Kaiko pegged the changes to Binance’s decision to end a promotion that scrapped trading fees.

“Offshore markets have become less concentrated, with smaller exchanges gaining momentum as trade volumes recovered,” the company’s analysts wrote in a note.

Platforms like Bybit and OKX have expanded their footprints in regions such as Asia, while Binance has been grappling with the fallout of legal issues. The company and co-founder Zhao Changpeng pleaded guilty to US anti-money-laundering and sanctions violations last November.

Bybit’s share of non-US bitcoin trading rose to 9.3 per cent over the past year from 2 per cent, Kaiko said. OKX accounts for 7.3 per cent, up from 3 per cent.

Binance has been trying to rebuild its reputation under the gaze of US regulators. Under new boss Richard Teng, a former regulator in Singapore, it has tightened token listing rules and appointed a board of directors.

The digital asset industry as a whole has benefited from a fourfold jump in the bitcoin price since the start of last year. The rebound from a 2022 rout took the token to a record high of US$73,798 last month.