Bybit Becomes the Second Largest Centralized Crypto Exchange, Surpassing Coinbase

A recent surge in trading volume has positioned Bybit as the second largest centralized crypto exchange (CEX), replacing Coinbase and “sitting” behind Binance.

Centralized crypto exchanges (CCX) have witnessed a surge in trading volume, with Bybit emerging as the second-largest CEX, surpassing Coinbase and trailing only Binance, as per Kaiko data.

Bybit has seen a remarkable 8% growth in market share over the past eight months, increasing its previous market dominance of 8% to 16%. Since October, the exchange's market share has surged from 8% to 16%, enabling it to overtake Coinbase in March to become the second-largest exchange after Binance.

During this period, Coinbase managed a 1% increase in market share despite recording positive profits and revenue. Analysts attribute this massive shift to Binance's past and present regulatory troubles, leading to a decline in its market dominance.

In November 2023, the US Securities and Exchange Commission (SEC) announced a $4.3 billion settlement with the exchange after it admitted to violating US Anti-Money Laundering rules. As reported by Crypto News Flash, the SEC sued Binance over alleged securities violations, misappropriation of billions of customers' funds, and more. However, there has been no evidence presented yet regarding fund misappropriation. Binance's market dominance has decreased by 6% since October, falling from 60% to 54%.

Commenting on this achievement, Ben Zhou, Co-Founder and CEO of Bybit, highlighted the exchange's competitive trading fees as a key factor in 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,” he said.

Bybit Seizes Opportunity with Competitive Trading Fee

To achieve this feat, the exchange introduced zero-fee trading for Circle's USD (USDC) stablecoin in February 2023, which positioned its average trading fees as the lowest in the industry and attracted numerous traders to boost its market share. Moreover, the exchange has seen a significant increase in Bitcoin (BTC) and Ethereum (ETH) trading volumes. Its market share for these assets has increased from 17% to 53% over the past year. However, Binance's BTC and ETH trading volumes have decreased from 59% to 43%.

Overall, centralized exchanges have experienced a substantial increase in trading volume since late 2023, with OKX reporting a 278% surge in 30-day volumes during this period. Binance had a overall growth of 239%, whereas Bybit recorded a surge of 264%. Coinbase followed these exchanges with a 193% surge in trading volume during the period under review.

In February 2024, Bybit announced a strategic partnership with UniSat, a leading blockchain interoperability solution. This collaboration enabled deeper liquidity pools for inscribed BRC-23 tokens on the platform, a streamlined user experience, and a unified marketplace, paving the way for greater opportunities in the inscription market.

“This partnership with UniSat marks a significant step forward in our mission to democratize access to inscription opportunities,” said Ben Zhou.

“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.”