Binance's bitcoin trading market share tumbles as rivals gain

Crypto exchanges are eating into Binance’s share of Bitcoin trading outside the US as overseas expansion efforts and changing regulations reshape the competitive dynamics of the digital-asset industry.

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

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 its co-founder Changpeng Zhao pleaded guilty to US anti-money laundering and sanctions violations in November last year.

Bybit’s share of non-US Bitcoin trading reached 9.3% over the past year, up from 2%, according to Kaiko. OKX accounts for 7.3% currently, up from 3%. 

Binance has been trying to rebuild its reputation while operating under the watchful gaze of US regulators. Under new boss Richard Teng — a former regulator in Singapore — the exchange 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 $73,798 last month, catalyzing trading volumes. Bitcoin was steady at $66,357 as of 8:20 a.m. in London on Tuesday.