The Impact of the SEC Lawsuit on Binance and Binance.US

1. Introduction

In early June, the US Securities and Exchange Commission (SEC) filed a lawsuit against Binance, the largest cryptocurrency exchange in the world. The SEC alleged that Binance had been involved in the sale of unregistered securities and had engaged in fraudulent activities and market manipulation. This article will examine the repercussions of the lawsuit on Binance and its American subsidiary, Binance.US.

2. The Collapse of Binance.US Volume

The market share of Binance.US, the American arm of Binance, has plummeted following the lawsuit. According to data collected by The Block, the total monthly trading volume of Binance.US reached its peak at around 16.05% in April. However, currently, it has dropped to only 4.29% of the total volume. Despite this significant decline, Binance.US continues to hold the 5th position among the largest trading platforms.

3. Determining the Volume of Binance.US

To determine the volume of Binance.US, The Block analyzed the data of the 17 largest trading platforms that offer USD trading pairs. However, they have excluded Binance from this analysis as the exchange is temporarily unable to process dollars. Similarly, the international Binance has also been excluded from the calculation since it is facing the same issue with dollar trading pairs.

4. The Growth of International Binance

Interestingly, the market share of the international Binance has shown a slight growth. The Block tracks the volume of the largest platforms that do not offer regular dollar trading pairs as well. As of June 19, Binance has achieved a monthly volume of $130.5 billion, while Binance.US stands at $1.7 billion. This growth in market share could be attributed to the shift in volume from USD trading pairs to stablecoin trading pairs.

5. Overall Volume and Market Share Analysis

The data reveals a significant decline in trading volume across exchanges, particularly for platforms that exclusively deal with stablecoins. In fact, the volume for such exchanges is four times lower. The decrease in overall trading volume has been reported as historic lows. Additionally, the biggest decline in market share has been observed in the case of Upbit, dropping from 12.3% in April to just 8% in June.

In conclusion, the SEC lawsuit has had a detrimental effect on the market share and volume of Binance.US. However, the international Binance has managed to maintain its position and even experience slight growth. The impact on the broader cryptocurrency exchange market has been a sharp decline in volume, particularly for stablecoin trading pairs. The fallout from the lawsuit is likely to continue shaping the landscape of the cryptocurrency industry in the coming months.