Report Shows Binance Now Commands 67% of Crypto Trading Activity

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The world’s leading cryptocurrency exchange, Binance, remains firmly at the helm, closing 2022 with a 66.7% command of the trading market, in comparison to 48.7% at the beginning of the year. In a report by CryptoCompare, Binance took 66.7% of the market trading pie as far as centralized crypto exchanges are concerned at the end of 2022, after the FTX collapse. FTX was the company’s greatest rival.

An analysis found that Binance’s market share rise emerged even as the platform experienced a 45% decline in its trading volume. OKX and Coinbase Global Inc. (NASDAQ: COIN) shared the trading floor at 8.58% (OKX) and 8.50% (Coinbase) with a $813 billion and $805 billion trading volume respectively.

The same analysis also reported on a total of 11 exchanges, including Binance, Bittrex, Bybit, crypto.com, KuCoin, Coinbase, Kraken, Bitfinex and OKX, among others. Of the above, Bybit and Kucoin increased their trading volume last year. Bybit also experienced market share growth during 2022.

The bumper harvest by Binance can be pinned on industry consolidation even as volumes were trending downward and the exchanges were competing for the reduced volumes, said the report. Furthermore, Binance’s decision to scrap trading fees for BTC and ETH in 2022 was followed by a huge surge in trading volume. This made Binance exceed the gross total volumes for 13 other exchanges by mid-September. The exchanges included Coinbase, Huobi, FTX and others.

U.S. crypto exchange Coinbase emerged second best in market share size by the end of 2022, standing at 8.2% compared to 10.1% at the beginning of 2022. Coinbase was followed closely by OKX, whose market share stood at 5.9% in December compared to 10.7% at the beginning of 2022.

The report further stated that overall trading volume in 2022 for centralized exchanges dipped by 46.2%. Crashing crypto prices and the decreased industry volatility were some of the key factors affecting the spiraling of the trading numbers.

Some of the greatest signals depicting the lack of engagement in the market are the decline in stability as well as volatility. On Oct. 22, 2022, the interannual 30-day Bitcoin volatility dropped to 26.6%, the lowest since mid-2020, conveying the risk aversion sentiment within the market.

The report asserts that 2022 was a “transformational year” for the digital asset space with episodes such as the crash of FTX and terra highlighting the discrepancies within the industry. Additionally, such episodes denote benefits defi can bring onboard through transparent and seamless infrastructure.

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