Trusted

Binance Shuts Down Payment Portal as It Loses Ground to Smaller Rivals

2 mins
Updated by Ryan Boltman
Join our Trading Community on Telegram

In Brief

  • Binance will discontinue its fiat-to-crypto payment portal, Binance Connect, due to a changing market.
  • The firm's market share dropped from 60% to 40% this year amid termination of agreements with payment providers.
  • Smaller, riskier exchanges have seen a surge in trading volumes, despite greater risk of customer fund loss.
  • promo

Binance will shut down its fiat-to-crypto payment portal enabling Mastercard and Visa crypto payments. Binance Connect, previously Bifinity, will be discontinued due to “changing market and user needs” as smaller exchanges attract traders.

The move, set to take place On Wednesday, follows the termination of agreements with payment providers in Europe and Australia. The exchange faces a shrinking pool of infrastructure partners as reputational damage sustained by several investigations hurt short-term volumes.

Venues With Higher Risks Assume Volumes as Binance Fails to “Connect”

The market share of Binance alone has fallen from about 60% at the start of the year to 40% at present. While the exchange is still the largest venue for spot and derivatives, the ground is shrinking beneath its feet.

Binance to stop its payment service while facing increasing pressure from volume growth at smaller exchanges.
Volumes at top tier exchanges have increased since January | Source: Financial Times

A recent report by CCData found smaller exchanges perceived to pose higher risks to customers are experiencing higher trading volumes. Huobi and KuCoin, the former of which reportedly faces insolvency, saw their shares of trading volumes rise this year.

Upbit led Korean exchanges’ July surge with $29.8 billion in volume, beating Coinbase’s $28.6 billion. Other Korean businesses, Bithumb and CoinOne, also saw year-to-date spot volume increases of 27.9% and 4.7%.

Want to trade without disclosing sensitive information? Read our list of the best crypto exchanges that allow no-KYC trading.

However, large venues like Coinbase and Binance have seen their collective share of volume decline from 80% to 68% in the same year. Additionally, Binance recently announced the delisting of several trading pairs, including CKB/BUSD, FARM/BUSD, ORN/BUSD, REN/BUSD, SKL/BUSD, UFT/BUSD, ZEN/BUSD, and ZRX/BUSD.

Both companies face lawsuits from US regulators.

Smaller Exchanges Can Attract Traders With Higher Risk Appetites

Smaller venues that have seen a surge in trading activity are deemed risky according to several metrics. According to CCData, these exchanges pose a higher risk to customer funds and have lower anti-money laundering standards.

According to CK Zheng of ZX Squared Capital, the trend toward these smaller companies may also occur because their sizes don’t concern regulators. Elliptic’s Tom Robinson opines some traders may be willing to forego safety to invest in coins that bigger exchanges avoid.

Got something to say about Binance shutting its payment portal or anything else? Write to us or join the discussion on our Telegram channel. You can also catch us on TikTokFacebook, or X (Twitter).

🎄Best crypto platforms in Europe | December 2024
eToro eToro Explore
Coinrule Coinrule Explore
Uphold Uphold Explore
Coinbase Coinbase Explore
3Commas 3Commas Explore
🎄Best crypto platforms in Europe | December 2024
eToro eToro Explore
Coinrule Coinrule Explore
Uphold Uphold Explore
Coinbase Coinbase Explore
3Commas 3Commas Explore
🎄Best crypto platforms in Europe | December 2024

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

David-Thomas.jpg
David Thomas
David Thomas graduated from the University of Kwa-Zulu Natal in Durban, South Africa, with an Honors degree in electronic engineering. He worked as an engineer for eight years, developing software for industrial processes at South African automation specialist Autotronix (Pty) Ltd., mining control systems for AngloGold Ashanti, and consumer products at Inhep Digital Security, a domestic security company wholly owned by Swedish conglomerate Assa Abloy. He has experience writing software in C...
READ FULL BIO
Sponsored
Sponsored