The ongoing bear market in the crypto market is forcing exchanges to make strategic changes to sustain their operations. Among the changes that have been implemented include lowering the transaction fees to attract and retain users.
Crypto exchange fees war
Binance US announced it would remove fees on Bitcoin trading activities against stablecoins and the US dollar. This move will support Binance’s ambition to expand into the United States and attract more users.
Binance is the largest exchange globally by trading volumes. However, the company operates under Binance US in the US, where Coinbase takes the lead as the largest cryptocurrency exchange. Coinbase is now putting in the effort and has also announced its own initiative to battle the trading fees.
Coinbase announced it would sunset Coinbase Pro by the end of the year. The company plans to create a single exchange platform with a standard fee structure. The company further said it would unveil its first derivative product.
Cryptoassets are a highly volatile unregulated investment product. Your capital is at risk.
The Binance Vs. Coinbase debate has intensified with how the two platforms are operating during the ongoing bear market. Binance has announced it has 2000 open positions and said it will not hire freezing despite the ongoing recession. On the other hand, Coinbase has laid off around 18% of its global workforce. The exchange also said that it was freezing its hiring process.
Binance eyes a large share of US markets
Binance US seems to be working towards dominating the US cryptocurrency market. The US crypto market is currently dominated by Coinbase. The exchange has the largest number of users and trading volumes compared to other leading exchanges in the country.
In December last year, Coinbase’s market share in the US crypto market was 70%. However, the market share has since dropped to around 50%. Kraken, another top social trading platform in the US, accounts for a 30% share of the US crypto space. This is double the 15% share in November 2021.
Binance US is still fighting for a dominant position in the US market alongside other firms such as FTX.US. Binance US’s major competitor is Gemini, and the exchange has been taking up Gemini’s market share. The removal of Bitcoin trading fees on Binance US could pressure other firms such as Coinbase and Kraken to lower their fees and retain their share of the US crypto space.
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Cryptoassets are a highly volatile unregulated investment product. Your capital is at risk.
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