Binance lost 98% volume in the US

Regulatory pressure is causing serious problems for Binance.US, the North American division of the world’s largest cryptocurrency exchange, as recent figures on the company’s trading volumes show a worrying decline.

Binance’s battle with US regulators has negatively impacted its business, leading to an evaporation of trading volume.

According to a recent report from CCData, Binance.US’ monthly trading volume fell 98% in August compared to January 2021.

Until September 15, the volume was $115.7 million, while in August it was $286 million. Such a setback is remarkable, especially considering Binance’s size and influence in the global cryptocurrency market.

Binance US Kaiko volume
Binance US Kaiko volume

By comparison, Binance.US had a daily trading volume of $10 million on Monday (18), while Coinbase, the largest exchange in the US, recorded a daily trading volume of $950 million, according to data from CoinGecko.

Binance US Volume
Binance US Volume

Binance.US loses 98% market share in the US

According to CCData, most of the decline was seen after March, when Changpeng Zhao, founder and CEO of Binance, was charged with several violations by the US Commodity Futures Trading Commission.

In June, the US Securities and Exchange Commission (SEC) filed complaints against Binance.US, Zhao and for a series of alleged violations. Such accusations, including “misrepresentation of trading controls and oversight on the Binance.US platform”resulted in a legal dispute.

After being sued by the SEC in June, the company faced several fallout, including the loss of bank support, the suspension of US dollar deposits and a series of layoffs.

The series of events resulted in the departure of Binance.US CEO Brian Shroder, who left the company last week, along with the layoff of a third of its workforce.

At the time, Binance CEO Changpeng Zhao said the speculation surrounding Sorder’s departure was a “deserved break.”

Meanwhile, the SEC last Monday sought permission to inspect Binance.US and force the exchange to provide various information about its activities, meaning regulators’ pressure on the company remains high.

Why is Binance languishing in the US?

The volume drop on Binance.US could mean investors fear an FTX-like meltdown. Concerns about legal issues or other uncertainties can also lead users to look for alternative platforms.

The situation serves as a warning sign not only for Binance.US, but for the entire US cryptocurrency industry.

The outcome of the battle between the SEC and Binance is expected to have significant implications for the cryptocurrency industry in the United States. If the regulator wins, it could set a dangerous precedent for other cryptocurrency exchanges and companies, potentially forcing them to register their products and services with the agency.

Source: Live Coins