- Binance’s market share rose to 49% in January.
- The inflow of stablecoins into Binance has increased significantly this month.
The largest crypto exchange in the world, Binance [BNB]has dramatically improved its market share since the legal resolution with the US Department of Justice (DOJ) in November 2023.
According to leading crypto market researcher Kaiko, Binance’s market share against 23 other centralized exchanges rose to 49% in January, up from multi-year lows in the latter part of 2023.
Source: Kaiko
The crypto giant has resolved its disputes with the US government by agreeing to pay a $4 billion fine and taking measures to improve compliance with local laws.
The event also resulted in the departure of former CEO and one of the most popular faces in the industry: Changpeng Zhao (CZ).
As you can see, there was no major impact on Binance’s share of trading volume immediately after the settlement took place.
However, key developments in December and January turned the tide in Binance’s favor.
Binance has reintroduced the very popular zero promotions in December for top assets like Bitcoin [BTC]Ethereum [ETH]and XRP.
The move was apparently made to increase demand for stablecoin, First Digital USD [FDUSD].
For the curious, Binance’s zero-fee trading program was a major factor in boosting volumes and expanding the market in 2022.
The fact that there was a serious drop in volumes when the campaign ended last year reflected its strategic importance.
Additionally, the hype surrounding Bitcoin spot ETFs in early January boosted trading volumes across the industry.
According to AMBCrypto’s analysis of CryptoQuant data, stablecoin inflows into Binance increased significantly in the days leading up to the approvals, indicating greater buying/trading activity.
Source: CryptoQuant
Is your portfolio green? View the BNB Profit Calculator
The events discussed above therefore played a major role in pushing Binance’s market share to 50%. In the report, Kaiko said:
“The exchange has proven especially resilient in the aftermath of the settlement.”
That said, there was still a great distance to be covered. Binance’s market share still remains significantly lower than its 2023 peak of 65%.