Why does Binance dominate spot and futures trading volume for cryptocurrency?
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Answer Why does Binance dominate spot and futures trading volume for cryptocurrency?
Binance continues to dominate the cryptocurrency sector in large parts of it.
Binance’s dominance over spot trading is estimated at 55.1%, and its dominance over derivatives at 54.4%.
Binance’s closest competitor is crypto exchange Upbit, with the latter dominating the spot trading volume with 6.1%.
In the derivatives segment, the OKX trading platform comes in second place as it dominates the derivatives trading volume with 14.1%.
As for the most important reasons for Binance’s superiority, it is due to the way it is marketed and its early penetration into new markets. Among the offers that made Binance widen the gap between it and its competitors:
Bitcoin trading without fees:
To celebrate its five-year anniversary, Binance announced zero fees for trading 13 currency pairs against Bitcoin.
Bitcoin makes up a large portion of the trading volume in the entire crypto market.
Thus, zero fees on bitcoin trading should contribute significantly to the overall dominance of spot trading volume.
Additionally, traders who are tempted towards Binance to trade bitcoin may also consider trading altcoins for convenience and ease of money management.
Many followers of the crypto arena believe that Binance is taking advantage of the bear market to gain more market share because it can afford zero fees, while competitors cannot.
Withdraw bitcoin from trading platforms:
According to the CEO of CryptoQuant, whales are accumulating bitcoin on Binance.
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Besides the increase in spot trading volume dominance, more than 48,000 bitcoins were withdrawn from crypto exchanges last week, causing many to question whether this behavior is positive or not on the crypto market.
Currently, it can be said that the bear market has not affected Binance’s global expansion plans.
Last month, Binance, led by Changpeng Zhao, was successfully registered as a financial services provider in New Zealand.
The company also recently registered its presence in France, Spain and Italy.
The global expansion must have certainly brought in new traders for the company, thus increasing the trading volume dominance.
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