Binance futures drop below 60%

Binance is losing perpetual cryptocurrency futures market share as exits from major markets affect trading volumes.

The lower trading volumes also come as Binance is under investigation by the US futures market regulator, the Commodity Futures Trading Commission.

The lawsuits see Binance lose stake in Asian exchanges

While the exchange started the year accounting for 66% of perpetual futures trading volumes, June data revealed that the number had fallen by about 10%, to 56.7%. Recently, Binance removed a permanent futures contract related to the failed LUNC cryptocurrency.

Binance’s stake in perpetual futures contracts down 10% since the end of 2022 | Source: Kaiko Research

Find out here where to trade cryptocurrency futures.

The exchange has also seen a drop in spot volume since it was later sued by the SEC.

Recent exits from affluent jurisdictions such as France, the Netherlands and Canada and the cancellation of the no-fee promotion may also have contributed to the 11% drop in spot trading volume.

Asian competitors Bybit and OKX appear to have captured most of Binance’s lost trading volume.

In March, Binance resumed charging fees for BTC stablecoins with the exception of TrueUSD. TUSD accounts for over 10% of BTC spot trading volumes on Binance and 20% globally.

However, order books reveal a lack of market depth for the stablecoin, which indicates that market makers are being cautious in providing liquidity.

Coinbase’s share of the spot market is down 2.6% as market depth declines

Other exchanges, Coinbase and Bittrex, have borne the brunt of the SEC enforcement, with Coinbase’s share of spot trading down 2.6% this year.

Decrease in spot size
Coinbase is losing 2.6% of its market share since the beginning of the year | Source: Kaiko Research

Bittrex saw market depth of the top 10 coins drop by 68%. Meanwhile, OKCoin, which recently received a cease and desist order from the Federal Trade Commission, lost 85%.

Global BTC liquidity fell by $10 million in the quarter, which led to the exit of two important market makers, Jump Crypto, and Jane Street.

The US Commodity Futures Trading Commission has accused Binance of illegally allowing US trading firms to access its OTC trading desk earlier this year. According to the Commodity Exchange Act, companies that want to offer derivative products to customers must register with the CFTC. Litigation continues.

In another lawsuit, US Securities and Exchange accused Binance of mishandling customer funds and offering unregistered securities.

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