Bybit Rises to Second Spot Among Crypto Exchanges, Leaving Coinbase Behind Amid Binance’s Regulatory Challenges

• Bybit outshines Coinbase to become the second-largest centralized exchange by trading volume after recording an eight-month growth in market shares of 8%. 

• According to data, Coinbase recorded only 1% growth during the period, with Binance declining from 60% to 54%. 

A recent surge in trading volume has positioned Bybit as the second largest centralized crypto exchange (CEX), replacing Coinbase and “sitting” behind Binance. According to data by Kaiko, Bybit has witnessed an incredible growth of 8% in market shares over the past eight months, doubling its previous dominant rate to 16%. 

Since October, the exchange’s market share has surged from 8% to 16%, surpassing Coinbase in March to become the second-largest exchange after Binance.

Within the same period, Coinbase only managed a 1% increase in market shares despite recording positive profits and revenue. In investigating this significant improvement, analysts observed that the massive shift was triggered by Binance’s past and ongoing regulatory issues, causing it to lose some of its dominance. 

In November 2023, the US Securities and Exchange Commission (SEC) announced a $4.3 billion settlement with the exchange after admitting to violating US Anti-Money Laundering rules. As Crypto News Flash reported, Binance was sued by the SEC over alleged securities violations, misappropriation of billions of customers’ funds, etc. However, no evidence of fund misappropriation has been presented yet. Since October, Binance’s dominance has fallen 6% from 60% to 54%. 

Speaking on this, co-founder and CEO of Bybit Ben Zhou disclosed that the cheap and competitive fees of Bybit have earned it this historic milestone. 

Our commitment to providing competitive fees, a safe and secure platform, and innovative products like Unified Trading Account has resonated with our users.

Bybit Seizes Opportunity with Competitive Trading Fee

To come this far, the exchange introduced zero-fee trading for Circle’s USD (USDC) stablecoin in February 2023, making its average fees the lowest in the industry and attracting many traders to boost its market shares. In addition, it has recorded a significant increase in the trading volumes of Bitcoin (BTC) and Ethereum (ETH). In the past year, its market shares of these assets have surged from 17% to 53%. However, Binance’s BTC and ETH trading volumes have declined from 59% to 43%. 

Generally, Centralized Exchanges have recorded a substantial increase in trading volume since late 2023, with OKX reporting a 278% surge in 30-day volumes within the period. Binance had a general growth of 239%, while Bybit recorded a surge of 264%. Coinbase also followed these exchanges with a 193% surge in trading volume within the period under review. 

In February 2024, Bybit announced a strategic partnership with UniSat, a leading blockchain interoperability solution. This collaboration paved the way for deeper liquidity pools for inscribed BRC-20 tokens on the platform, a streamlined user experience, and a unified marketplace. 

Ben Zhou commented on this:

This partnership with UniSat marks a significant step forward in our mission to democratize access to inscription opportunities. By integrating UniSat’s powerful functionalities into our user-friendly platform, we are empowering everyone to participate in the inscription market with greater ease and confidence as well as creating a simpler, open, and equal BRC-20 ecosystem for everyone.