on the crypto
The specialized site CoinGecko has just published the data relating to the market shares of each exchange. As expected, Binance is the big winner. Let's look at the data in detail!
Binance Strengthens Its Dominance!
CoinGecko, one of the leading sites in the cryptocurrency industry, regularly publishes data on different exchanges. On Nov. 16, the site released a chart comparing the daily volume of spot and derivatives trading between Oct. 26 and Oct. 13 on major cryptocurrency market exchanges.
The first and most logical lesson is the fall of FTX after the rumors of the insolvency of Alameda Research and then with the collapse of the exchange on November 11th. Which stock exchanges have benefited from it?
We note that it is above all Binance that has benefited from the collapse of FTX. Indeed, from November 11 to 13, Binance saw its market share increase by 7%, from 57% to 64%. The stock exchange therefore remains the undisputed leader of this market and is strengthening its dominant position.
OKX also appears to be one of the winners of this crisis, as its market share has increased from 11,9% to 13%. While other exchanges have grown in volume, this figure is less impressive.
A sharp increase in trading volumes
The collapse of FTX plunged the cryptocurrency market into the red. As a result, this selling pressure has resulted in an explosion in trading volumes, especially on Bitcoin Pro. Indeed, an increase in trading volumes of almost 120% has been observed on all of these exchanges.
This sharp increase started on Nov. 8, when Binance hinted that it would acquire its competitor FTX. The acquisition fell through after Binance furthered its analysis of the stock situation.
This sharp increase in volumes is mainly due to the sudden and unexpected crash of FTX. As a reminder that FTX was still the second largest exchange in the industry just 10 days ago. From November 1 to November 10, the exchange recorded a trading volume of more than $141 billion. Despite the bankruptcy and disruption of services in recent days, the company maintains its fourth place in terms of trading volume.
The contagion effects of the FTX crash led to a massive flight of investors and thus a sharp increase in trading volumes.
Trading volume is also increasing on Crypto.com, according to data from CoinGecko, but in reasonable proportions. It will be interesting to monitor this indicator, as the stock market has to defend itself and is in a turbulent situation.
Is Binance hegemony dangerous for the industry?
Binance is strengthening its leadership position. This growing dominance is not to the liking of all observers of the cryptocurrency industry. The omnipotence of a centralized operator like Binance is worrying, and rightly so. Indeed, what if the latter were to fail, as we have seen with FTX.
The consequences would certainly be dramatic. Some point to the irony that an asset like cryptocurrency, which is meant to be decentralized, is in the hands of a centralized operator like Binance. The fact that the CEO of the stock exchange can make decisions about the market disturbs many.
For now, Binance appears to be comfortably installed in its leading position and it's hard to imagine that this will change in the years to come. The company is spread all over the world and seems to be one of the strongest in the market. There are many examples of monopolies harming an economic sector.
We will have to carefully observe the coming months and the evolution of this distribution to see if Binance will strengthen its ultra-dominant position on the cryptocurrency market!
