Highlights:
- Bybit is now the world’s second-largest crypto exchange by volume.
- Bybit’s growth is attributed to competitive fees, the Bitcoin ETF launch, and Binance’s regulatory challenges.
- Binance’s market dominance drops from 60% to 54% amid regulatory hurdles and fines.
The Singapore-based crypto exchange Bybit has flipped US-based Coinbase to become the world’s second-largest centralized crypto exchange (CEX) by trading volume after Binance. According to a report by Kaiko on June 25, Bybit’s market share has surged from 8% to 16% since October 2023, while Coinbase’s share has increased by just 1% during the same period. Due to this consistent growth, Bybit overtook Coinbase in March, becoming the second-largest digital asset trading platform.
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Bybit surpassed Coinbase in March to become the world’s second-largest cryptocurrency exchange after Binance, according to a report from crypto research firm Kaiko. https://t.co/aPZyw3jiC7
— Bloomberg (@business) June 25, 2024
Key Factors Behind Bybit’s Impressive Growth
Bybit stands out as the world’s largest digital asset trading platform due to several notable factors.
Spot Bitcoin ETFs Launch and Binance’s Regulatory Challenges
Bybit’s growth can be attributed to several factors, including the launch of spot Bitcoin exchange-traded funds (ETFs) in the United States and the decline in Binance’s dominance due to regulatory issues. Kaiko noted that both the launch of spot Bitcoin ETFs and Binance’s regulatory issues increased trading volumes for all crypto exchanges except Binance. However, not all benefited equally. Bybit recorded the most gains, while Coinbase saw only a minor increase despite reporting higher profits and revenue.
Since October, Binance’s market dominance has dropped from 60% to 54%, a 6% decrease, partly due to the exchange’s regulatory challenges. On November 21, 2023, US authorities announced a $4.3 billion settlement with Binance for Anti-Money Laundering violations, representing one of the largest criminal fines in US history.
In June 2023, the SEC sued Binance and Coinbase for alleged securities violations. The SEC claimed in the lawsuit against Binance that the company and its founder, Changpeng Zhao, misappropriated billions of user funds. Despite these allegations, no evidence of user fund misappropriation has been found. Binance continues to be the world’s largest cryptocurrency exchange by trading volume.
Bybit Competitive Fee Structure
Bybit offers some of the lowest transaction fees in the crypto market, alongside OKX and Binance. Similar to exchanges running zero-fee promotions for assets such as TrueUSD (TUSD) and First Digital USD (FDUSD), Bybit implemented zero fees for USD Coin (USDC) in February 2023.
Furthermore, Bybit’s BTC and ETH spot trade volume market share has surged from 17% to 53% over the past year. In contrast, Binance has witnessed a decrease in BTC and ETH volumes, with their market share falling to 43% this year from 59% a year ago.
The exchange plans to maintain its commitment to affordable and competitive fees, as per Ben Zhou, the co-founder and CEO of Bybit.
He wrote:
“We are thrilled to see Bybit’s continued growth and recognition in the industry. Our commitment to providing competitive fees, a safe and secure platform, and innovative products like Unified Trading Account has resonated with our users.”
Binance, Bybit, and OKX Monthly Volumes Tripled Since Late 2023
Many CEXs at least tripled their monthly trading volumes from October 2023 to March 2024, according to Bybit’s Institutional Report 2024. OKX reported a 278% surge in 30-day volumes since October 2023, while Binance closely followed with a 239% increase despite legal issues. Bybit also saw substantial growth, with a 264% rise in trading volumes. Coinbase recorded a 193% increase in trading volumes over the same period, slightly below the average growth rate of other major exchanges.
#OKX, #Binance and #Bybit monthly volumes tripled since late 2023 :
According to Bybit data, the growth trend of CEXs has failed to overtake the growth rate of #decentralized exchanges (#DEX), as major DEX #Uniswap v3 increased volumes by 320%.
According to data from the Bybit… pic.twitter.com/qs3wEQzZFs— TOBTC (@_TOBTC) April 18, 2024
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