Binance’s efforts to recover from recent setbacks are progressing slowly. The platform’s market share in the $2 trillion digital asset market fell to its lowest point in four years in September, according to Bloomberg. Binance’s share dropped to 36.6%, down from 42.7% at the beginning of the year, according to CCData. This decline represents a notable trend shift, and the platform’s share of the spot market is also down to 27%, which is the lowest since January 2021.
The loss of market share comes against the backdrop of continued regulatory issues that Binance has experienced globally. The regulators have been focusing on the company since March 2023. In the case of charges such as sanctions violations, it settled with the U.S. Justice Department and several other agencies last year. Nevertheless, as a result of the settlement, Binance committed to paying a $4 billion fine.
Moreover, there have been leadership changes in the exchange. CEO Zhao Changpeng stepped down, and the firm hired Richard Teng, a former official, to be the new CEO. Teng has been mainly concerned with the regulators and their issues with the company. However, the market share of Binance has been decreasing continuously even after the launch of these products.
Crypto Winter Hits Binance Harder Than Competitors in September
The decline is not only seen on the Binance platform but also on similar platforms. Spot and derivatives trading volumes on centralised exchanges fell by 17% in September. This was a winter month for trading in cryptocurrencies, and the overall turnover was the lowest in the past months. Still, Binance was affected the most, with the exchange’s market share decreasing more than its competitors.
Year over year, Binance derivatives market share has now declined to 40.7%, its lowest since 2018. The platform’s problems are arising at a time when competitors are recording improved performance. While Binance continues to wobble, other exchanges are capitalising on the company’s decline in market share.
It is still unclear which path Binance will take to recovery. Whether new leadership and regulatory attempts will help to stop the current trend remains to be seen. For now, Binance has been gradually losing its market share due to increasing pressure from regulators and other competitors.
