Binance US becomes the first cryptocurrency exchange to eliminate trading costs for Bitcoin (BTC) spot market trades for all users.
According to the CEO of Binance.US Brian Shroder, there are plans to increase the number of tokens that will support zero-fee trading in the future. He also predicted that the elimination of trading fees would boost user sentiment.
US has eliminated trading costs for Bitcoin (BTC) spot market trades, following Robinhood, which set the standard for no-commission cryptocurrency trading in 2018.
The move, according to Brian Shroder, CEO of Binance.US, makes the company the first cryptocurrency exchange in the United States to completely abolish spot trading costs for Bitcoin for all users without imposing trade volume limitations. They would also not be receiving a spread on deals, he continued.
“We see this as an opportunity to revolutionize the way fees are approached in our industry, increase accessibility to crypto, and better support our market and customers in a time of need.”
Its rivals are under pressure to follow suit after hearing about the increasing competition on fees. On Wednesday, shares of competing American exchange Coinbase decreased 9.71 percent, reaching $51.91 per share. The share price of Robinhood, which is already at an all-time low, remained largely constant at -0.79 percent to $7.49 at the time of writing.
Currently, trading costs on Coinbase, Kraken, and FTX.US range from zero to fifty percent, zero to twenty percent, and zero to twenty-six percent, respectively.
The currency pair, 30-day trading volume, and whether the order is a maker or taker order all play a role in determining how much of a trading fee is charged.
On Wednesday, Shroder told Bloomberg that Binance.US would not be making a profit from its no-fee transactions but rather would be making money from other sources, such as a new staking service:
“We take no spread, because we are not involved in the transaction.”
He said that the absence of trading fees will result in favorable user sentiment and bring us additional users. He also claimed that there are plans to eventually increase the number of tokens that will be available for zero-fee trading. Currently, customers of the exchange with a U.S. license can benefit from fee-free trading on four Bitcoin spot market pairs: BTC/USD, BTC/Tether (USDT), BTC/USD Coin (USDC), and BTC/BinanceUSD (BUSD).
In addition, the business will be implementing a new tiered pricing strategy, which will take effect in the summer, Shroder informed his 8,200 Twitter followers.
The three sections of the tiered scheme are Tier 0, which enables free trading on some cryptocurrencies, including the previously announced BTC pairs, Tier 1, which will have trading costs determined “per-asset,” and Tier 2. July is when more details are anticipated.
Incorporated in 2019, Binance
Binance’s US subsidiary is the world’s largest cryptocurrency exchange. Only American cryptocurrency traders are catered to by the exchange, which is separately run by the parent corporation.
When it was established in 2014, Robinhood was among the early adopters of zero-fee stock trading, inspiring several online brokerages to follow suit in the years that followed. Crypto trading with no commissions started in 2018. Even if it doesn’t collect fees, it can nevertheless profit from its fee-free transactions. The discrepancy between a trading pair’s bid (sell) price and ask (buy) price is known as a spread.
