Coinbase and Binance Are Largest Beneficiaries of FTX Fallout

Centralized cryptocurrency exchanges Coinbase Global Inc (NASDAQ: COIN) and Binance have recorded a sharp uptick in user base and daily traded volume in the past six weeks following the collapse of FTX and Alameda. According to aggregate data from cryptocompare, Binance’s market share for crypto-only exchanges rose to 87 percent in December from approximately 82.7 percent in September. Coinbase Global, on the other hand, has seen its share of the fiat exchange market spike to 40 percent in December from 22.8 percent in September.

Nonetheless, decentralized exchanges (DEX) and non-custodial crypto wallets have recorded the largest gain in the global user base following the FTX implosion. Furthermore, approximately 1 million worldwide cryptocurrency traders and investors were affected by the FTX and Alameda implosion. As such, fear of rug pulls especially on centralized exchanges has significantly increased in the past few weeks.

According to market aggregate data from Coinmarketcap, Binance and Coinbase lead the spot exchanges in the past 24 hours with trading volumes of approximately $8,582,628,378, and $1,192,133,466 respectively.

Notably, Binance has gained popularity with AI traders since it allows traders to borrow funds and participate in margin trading of up to 10X leverage. With the vast regulatory approvals worldwide, Binance continues to be the top priority for both experienced and novice traders. Moreover, the Binance ecosystem supports almost all the top blockchains and its crypto wallets have a desirable reputation with most traders.

Binance and Coinbase on the Limelight

The cryptocurrency market has grown to a trillion-dollar industry within a decade of existence and market strategists forecast it will comfortably do another 10X in the next ten years. As such, crypto companies that have shown resilience during the 2022 bear market are expected to play a crucial role in global adoption. Furthermore, analysts have compared the 2022 bear market to the early 2000s when most internet companies were adopted by mainstream investors.

Binance has approximately 90 million customers worldwide and a daily trading volume of over $76 billion. While the company remains under private ownership, the company has BNB coins that largely derive value from the crypto exchange. Moreover, Binance holds the largest share of BNB coins.

Coinbase, on the other hand, is publicly traded with its stock market over 90% below its IPO price. According to market data from MarketWatch, COIN shares are trading around $35.10 on Wednesday, while a year ago they were trading above $350.

Notably, Coinbase has a market capitalization of approximately $7.9 billion with top investors including Cathy Woods Ark Investments.