Binance has experienced a significant decline in its share of the spot trading market over the past year. In late 2022, Binance accounted for approximately 62% of spot trading volume across exchanges. However, by late 2023, its market share had fallen to only 40% – a reduction of one-third over a 12-month period.
According to a report published on November 6, 2023, researchers attribute Binance’s declining spot trading volumes to issues with its coin listing strategy. Analysis shows that many popular cryptocurrencies tend to immediately decrease in value after being listed on Binance. This listing effect may be deterring traders from using Binance for spot trading.
Meanwhile, Upbit, a South Korean exchange, saw the biggest increase in spot market share over the same period, growing from just 5% to 15.3% to become the second-largest spot exchange.
When including derivatives trading in addition to spot trading, Binance still holds the top position but its dominance has weakened. In October 2023, its total market share across spot and derivatives stood at 51.2%, down from 54.6% in October 2022.
OKX is a distant second at 13.4% market share, followed by Bybit (9.6%), Bitget (7.0%), and MEXC Global (6.9%). While Binance remains the leader, these second-tier exchanges have been steadily gaining ground and collectively account for over 40% of the total crypto trading market.
Meanwhile, formerly top-ranked exchange Huobi has fallen behind along with Kucoin, Gate, and others. These now make up a third tier of smaller exchanges trailing behind Binance and OKX.
Although website traffic and social media followers do not directly correlate with market share, Binance has seen a 5% decrease in its share of Twitter followers over the past year. At the same time, OKX has rapidly grown its follower count by over 200%.
In summary, while still the dominant force in crypto trading, Binance has ceded significant market share across spot and derivatives trading over the past year. Competitors like OKX and emerging exchanges are quickly catching up as Binance’s once-commanding lead continues to decline.
