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Binance's dominance in Bitcoin trading outside the United States is diminishing as offshore exchanges expand their reach and regulatory landscapes evolve, reshaping the competitive dynamics of the digital assets sector.
According to data Since Kaiko, Binance, which once dominated Bitcoin trading markets outside the United States, has seen a decline in its share of BTC trading over the past year, from 81.3% to 55.3%.
Binance loses global market share
Likewise, Binance's proportion decreased from 58% to 50.5% for small tokens and altcoins. Kaiko attributed these changes to Binance stopping its large-scale fee-free Bitcoin promotion implemented last year.
Smaller exchanges such as Bybit and OKX have gained momentum as trading volumes have recovered, leading to less focus on offshore markets.
Over the past year, Bybit's share of global Bitcoin trading outside the United States has jumped from 2% to 9.3%, while OKX's share has increased from 3% to 7. 3%.
This change in market dynamics comes amid various developments in the cryptocurrency space, including the fourth Bitcoin halving event this weekend.
Despite the anticipation surrounding the event, its short-term impact has been mixed. Bitcoin slightly outperformed its previous halvings over the first two days, up more than 3% since the event. However, historical data suggests that while short-term impacts may vary, the long-term trajectory remains bullish.
A notable development following the halving was the increase in transaction fees on the Bitcoin network. Average network fees hit an all-time high of $146, surpassing Ethereum's average fees of $3 on the same day.
Meanwhile, Bitcoin perpetual contract funding rates remained neutral despite a brief dip into negative territory before the halving. However, open interest in these perpetual contracts remains high, exceeding $10 billion.
Binance's efforts to rebuild its reputation
While Bybit and OKX have increased their presence in Asian markets, Binance has faced legal challenges. In November, the company's co-founder, Changpeng Zhao, pleaded guilty to violating U.S. anti-money laundering sanctions.
Binance, under the new leadership of Richard Teng, a former Singaporean regulator, is currently working to improve its image amid US regulatory scrutiny. The exchange implemented stricter token listing criteria and formed a board of directors as part of the effort.
At the same time, as geopolitical tensions escalate in the Middle East, demand for safe-haven assets has increased. Despite this, bitcoin has failed to attract significant flows. Its value fell 6% in April, while traditional safe-haven assets like gold and the US dollar rebounded.
Kaiko explains that this could be attributed to halving, which historically leads to increased short-term volatility. The report also recognizes that several other factors influence Bitcoin's performance during major market events.
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