Due to regulatory issues and a reduction in user incentives (such as no fees), cryptocurrency exchange Binance Holdings Ltd. is losing market share to other platforms.
According to Kaiko’s spot market volume data, Binance held 90% of the market at the beginning of the year, but that percentage dropped to 73% by mid-July. At the same time, OKX saw a rise in its share, which reached 11% and nearly doubled since January. Additionally, by growing their market shares, Huobi and Bybit now represent 9% and 7%, respectively, of the total volume of spot cryptocurrency trading.
As cryptocurrencies gain popularity, officials from all over the world are keeping an eye on and taking action to oversee and monitor crypto exchanges. Being the biggest cryptocurrency exchange in the world, Binance unavoidably caught their attention. Regulators are working to set guidelines and specifications for how exchanges should run, including licensing and AML compliance.
One instance is in the United States, where Binance was accused of providing unregistered securities by the Securities and Exchange Commission (SEC). Due to this, US users are no longer able to access specific trading pairs on Binance. These activities led to a lack of faith in the exchange system in the United States and produced unhappiness.