SEC lawsuits on crypto exchange Binance and founder Changpeng Zhao have affected the company’s business operations and trading volumes have been affected.
World’s largest cryptocurrency exchange by trading volume binance This month saw its market share decline following regulatory action by the US Securities and Exchange Commission in June.seconds) on the exchange and its head, Changpeng Zhao.
The lawsuit has particularly affected the US affiliate of the crypto exchange i.e. Binance.US. Blockchain data and research firm Kaiko reported that Binance’s share of the spot trading market dropped to 53.7% from 56% at the beginning of the month.
Binance’s market share has been quite volatile this year as it faces major regulatory action. Following a lawsuit by the US Commodity Futures Trading Commission earlier this year, Binance’s daily market share dropped to as low as 47% on April 6.
Furthermore, Binance’s market share declined earlier this year after the crypto exchange halted its zero-fee promotion in March 2023. Speaking on the development, a Binance spokesperson said Said,
The company will “continue to maintain its strong financial performance.” Our primary objective is to provide for our users by maturing our products and services and continuing to invest in compliance processes for a new era of regulatory certainty.
Binance is facing market competition
Big players in the traditional financial market have started venturing into the crypto space seeing greater opportunities and growing acceptance of the asset class. These players provide investors with a regulated environment for investing in cryptocurrencies.
Thus, they are likely to create more competition for giants like Coinbase and Binance, which are facing regulatory heat. “Centralized exchanges will find themselves in a squeeze between decentralized exchanges and traditional-finance players entering the market,” said Alex Swanevik, chief executive officer of crypto intelligence firm Nansen.
But Binance is not the only player facing regulatory heat. This month in June, the market share of US-based crypto exchange Coinbase declined from 7.6% in January to 6.8% in June.
Due to increasing regulatory and banking challenges, cryptocurrency exchange Binance has decided to withdraw from several countries. On 16 June, the company announced its exit from the Netherlands due to a failed registration attempt. It also faced scrutiny from French authorities after choosing the country as its European base. Additionally, on June 23, the Belgian authorities ordered Binance to cease its operations in the country.
Bhushan is a Fintech enthusiast and has a good grasp of understanding the financial markets. His interest in economics and finance drew his attention to the newly emerging blockchain technology and cryptocurrency markets. He is in the process of continuous learning and keeps himself motivated by sharing the knowledge he has acquired. In his spare time, he reads adventure fantasy novels and occasionally explores his culinary skills.
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