Binance, the world’s largest cryptocurrency exchange, faces some challenges in the US market, according to a report by Kaiko. The Exchange, which is the biggest by trading volume and market depth, has a strong presence in the global crypto market.
Regulatory Pressure From the U.S., Has Taking its Toll on Binance
The report showed that Binance accounted for 30.7% of the global market depth and 64.3% of the global trade volume in March 2023, thanks to its zero-fee trading strategy. However, this did not improve its market depth, which declined from 42% to 30.7%.
According to data, the top eight cryptocurrency platforms held a significant share of the market, with 91.7% of market depth and 89.5% of trading volume being attributed to these platforms. This demonstrates the concentration of the cryptocurrency market among a few major players.
The report also highlighted the growing concentration of altcoin trading on offshore exchanges, which increased from 65% to 71% compared to the previous year. This was mainly due to the regulatory challenges faced by crypto exchanges in the US.
Binance’s US subsidiary, Binance.US, lagged behind its competitors Coinbase and Kraken in terms of altcoin market depth, which was only $1 million on average. Binance.US has been under investigation by the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) for possible violations of US laws.
Binance’s dominance in the crypto exchange arena did not translate directly to its native token, Binance Coin (BNB), which experienced a decline of nearly 18% since its peak in January 2023. BNB was trading at around $216 at the time of writing, with a neutral trend on the Relative Strength Index (RSI).
Binance’s regulatory challenges may have more impact on BNB’s performance than on the exchange itself, as investors may be wary of holding a token that could face legal troubles in the future.
