Coinbase Competitors Sensing Exchange’s Weakness, Trying to Capitalize on It
The top US exchange, Coinbase, is rapidly losing its dominance, according to data published by Mizuho Securities USA, a US subsidiary of Japanese investment banking and securities firm.
The San Francisco-based cryptocurrency exchange has dropped to the 14th spot by trading volume. For comparison, it was in fourth place last year.
Its market share has declined to just 2.9% from 5.3% in the first quarter of the year.
Coinbase stock is down more than 80% from its all-time high. In the first quarter of the year, the company reported a loss of $430 million to its shareholders. With massive revenues soaring during the 2021 bull run, Coinbase announced it would lay off 18% of its staff in June.
As U.Today reports, noted short-seller Jim Chanos, who predicted Enron’s collapse in the early 2000s, said he was in a recession due to Coinbase’s declining fee revenue.
Coinbase is facing increasing competition on its home turf, with Binance.US, the US subsidiary of the global cryptocurrency giant, recently launching zero-fee trading to lure in more customers and eliminate the market leader’s market share. is of.
High trading fees were Coinbase’s bread and butter, but the exchange is losing its sheen. The exchange is charging some traders around 4%. For comparison, FTX.US only charges a 0.2% commission.
Coinbase competitors can rely on other revenue streams to offer extremely low fees.