Kaiko Indicates Declining Bitcoin Metric as Binance Encounters Intensifying Rivalry

The grip of Binance on Bitcoin exchanges outside the United States is losing its strength as global offshore exchanges broaden their operations and the ever-changing regulatory frameworks alter the marketplace dynamics in the cryptocurrency sector.

Research from Kaiko indicates that Binance’s command over non-U.S. Bitcoin trade has been waning, with its market share plunging from 81.3% to 55.3% within a year.

Diminished Worldwide Influence of Binance

Correspondingly, Binance saw its market share for smaller cryptocurrencies and tokens fall from 58% down to 50.5%. This shift was partly ascribed by Kaiko to Binance halting its significant Bitcoin zero-fee promotion from the previous year.

Increasing trade volumes have seen a rise for smaller rivals like Bybit and OKX, leading to a broader distribution of trade volume in international offshore markets.

Over the last twelve months, Bybit’s share in the Bitcoin trading market outside the U.S. has expanded from 2% to 9.3%, and OKX’s from 3% to 7.3%.

These market changes occur against the backdrop of several cryptocurrency industry events, including Bitcoin’s fourth halving which took place recently.

The halving sparked anticipation, yet its immediate effects were uncertain, with Bitcoin marginally outdoing its past halvings’ initial post-event performance with a 3% increase. Historical patterns show that despite varying short-term effects, Bitcoin’s long-term trends tend to be optimistic.

Following the halving, Bitcoin network transaction fees saw a significant uptick, skyrocketing to a peak of $146, trumping Ethereum’s average fee of $3 recorded on that same day.

Additionally, bitcoin perpetual contract funding rates have stayed around neutral, even after a brief shift into negative just before the halving occurred. Notably, these perpetual contracts continue to attract substantial interest, boasting over $10 billion in open interest.

Binance’s Drive to Refurbish Its Public Image

While Binance faces regulatory hurdles and by Bybit and OKX continue to build their presence in Asian markets, Binance encountered legal setbacks when co-founder Changpeng Zhao acknowledged the occurrence of U.S. anti-money laundering and sanction violations in November.

Optimistic about reshaping its stance, especially under U.S. regulatory scrutiny, Binance installed Richard Teng, an ex-regulator from Singapore, as the new leader. The exchange is taking steps like implementing more rigorous criteria for token listings and establishing a board of directors to enhance its reputation.

Amid mounting tensions in the Middle East and growing demand for safe-haven assets, bitcoin has not seen substantial inflow gains, unlike traditional assets like gold and the U.S. dollar which have experienced rallies. In April, Bitcoin’s value dipped by 6%.

This lack of attraction can be associated with the halving event, which has historically led to immediate higher volatility, as noted by Kaiko. The volatility connects with numerous other elements that come into play when analyzing Bitcoin’s behavior during significant market instances.