Coinbase is losing its dominance amid the present crypto fall and competitors are capitalizing on the exchange’s weakness
Coinbase is losing its dominance
According to data released by Mizuho Securities USA, a U.S. subsidiary of the Japanese investment banking and securities firm, Coinbase, the leading U.S. exchange, is quickly losing its hegemony.
By trading volume, the San Francisco-based bitcoin exchange has fallen to position 14. In terms of comparability, it finished fourth the previous year. Its market share has decreased from 5.3 percent in the year’s first quarter to just 2.9 percent.
Since reaching a record high, the value of the Coinbase shares has plummeted by more than 80%. The business suffered a $430 million loss in the first quarter of the year, which was bad news for its shareholders.
After earning enormous income during the bull market of 2021, Coinbase stated that it would lay off 18% of its workforce in June.
Competitors on the attack
Renowned short-seller Jim Chanos, who foresaw Enron’s demise in the early 2000s, claimed he was pessimistic about the exchange because of its dwindling fee income.
With Binance.US, the American division of the global cryptocurrency powerhouse, just announcing zero-fee trading to entice more clients and take market share away from the market leader, Coinbase is facing more competition on its home ground.
Coinbase’s main source of income was its exorbitant trading fees, but the exchange is fading. Some traders are charged approximately 4 percent by the exchange. FTX.US only levies a 0.2 percent commission, for instance. Competitors of Coinbase can afford to charge exceptionally low fees by relying on other sources of income.
