Bybit is now the second-largest crypto exchange
Headquartered in Singapore, the crypto exchange Bybit has now surpassed Coinbase, based in the U.S., climbing to the position of the second most significant platform for digital asset trades, following the leading exchange Binance.
A recent press statement, referencing findings from the cryptocurrency analytics firm Kaiko, highlighted that Bybit's portion of the market climbed from 8% to 16% since October 2023. In contrast, Coinbase saw a modest growth of 1% during the same timeframe. This growth trajectory enabled Bybit to overtake Coinbase in March, establishing itself as the crypto exchange market’s second heavyweight.
Bybit’s ascent is attributed to several key developments, amongst which include the introduction of spot Bitcoin ETFs in the U.S. and the diminishing dominance of Binance amid regulatory scrutiny.
An analysis by Kaiko pinpointed that these events spurred an uplift in trading activities across most cryptocurrency exchanges, with the exception of Binance. However, the benefits were not evenly distributed, particularly following the anticipation surrounding Bitcoin ETFs approval. Bybit emerged as the biggest beneficiary of these circumstances, while Coinbase experienced marginal growth despite reporting an uptick in profits and revenue.
It’s noteworthy that Binance is not the sole exchange facing a downturn in market share due to regulatory hurdles. Competitors including Upbit and OKX also reported decreased trading volumes for reasons not made clear. Binance itself saw its market share decrease from 60% to 54% following its $4.3 billion settlement agreement with U.S. regulators toward the end of 2023.
The factors fueling Bybit’s growing transaction activity extend beyond the narrative surrounding Binance and the U.S.’s spot Bitcoin ETF scene. According to Kaiko, the exchange’s enticing transaction fees and its increased market share in bitcoin (BTC) and ether (ETH) transactions have played a significant role.
Bybit is recognized for its competitive fee structure, ranking closely behind OKX and Binance. Continuing the industry trend of offering zero-fee promotions on select assets, Bybit launched a zero-fee initiative for USD Coin (USDC) transactions in February 2023.
Furthermore, since 2023, Bybit has seen its spot trade volumes for BTC and ETH soar from 17% to 53%. This surge in the spot trading sector is complemented by Bybit’s derivatives market, which has maintained its position as the runner-up to Binance throughout the year.
