- In late September, Bitcoin sterling trading volume soared to all-time highs, dominated by activity on Bitfinex.
- Bitfinex doubled its market share from 37% to 70% in the week of September 26.
- Binance and Coinbase saw a sharp decline in BTC pound traded volumes with their combined market share plummeting from 80% in mid-2021 to roughly 30% today.
The market for digital assets, like that of traditional finance and in general, like any industry, is in constant competition to respond to the needs of users, through better services, being the one who offers the best, the one who retains a larger share of the market.
The situation in which the financial market finds itself in general can cause the balance to tip to one side or the other, since Investors will always look for ways to get the highest returns with the lowest losses, which can in turn benefit or harm companies and financial institutions.
That is why, being the digital assets market an area of constant growth, it has attracted the attention of several people and companies, considering it as an investment option.
It is no secret to anyone that the entire world has plunged into strong inflation causing the local currencies of different nations to lose part of their purchasing power. Even currencies such as the Euro and the British Pound that have historically been valued above the dollar fell, trading at less than a dollar a unit.
Falling Pound Drives Bitcoin Buying
The pound has been inching lower against the dollar for years, hitting an all-time low against the US dollar on September 26 at $1,327, its lowest level since 1972 and also posting its biggest single-day drop since March 2019. 2020, when the covid-19 pandemic began.
Many have attributed the recent declines in the value of the British currency to tax cuts proposed by the now former Prime Minister. Liz Truss.
The fall in the value of their local currencies, such as the British pound, has made investors decide to venture into trading virtual currencies, At least that’s what a recent report from the main provider of cryptocurrency market data for institutional investors and companies pointed out, Kaiko.
According to the information provided, Bitcoin trading volumes were on the rise in the UK last September, andThis is possibly due to the fact that the operators could have taken advantage of the high volatility of the exchange rates.
Bitfinex outperforms Binance and Coinbase
That said, as the saying goes, “everyone wants to make firewood from a fallen tree”, this is because in situations in which someone or something goes wrong, there will be someone who benefits from that misfortune on their counterpart.
This is the case of the digital asset exchange Bitfinex, which has benefited from the current situation since it practically doubled its market share from 37 percent to 70 percent in the last days of last September, interestingly, the same week that the pound sterling hit, as we mentioned earlier, an all-time low against the dollar.
However, not everyone in the crypto field has been a winner as two big fish, which would be expected to be more fruitful with these changes and who would be at the forefront of the beneficiaries, did not benefit as much as the exchange founded in Hong Kong
Firms Binance and Coinbase, unlike Bitfinex, have been on a slide with declines in their Bitcoin trading volumes traded fairly with pounds as reported by Kaiko. Also their combined market share has also suffered a significant decline, prising from a robust 80 percent at the end of the first half of last year, to roughly 30 percent today.
Focusing a bit on Binance, according to the data, everything seems to indicate that the drop in its volumes was largely due to the fact that the exchange house had to put on standby the bank transfers of the Single Payment Zone in Euros ( SEPA) for a long period, between July of last year and March of this 2022.
Claire Medalie, current director of research at Kaiko, declared for the medium Decryptthat “cryptocurrency exchanges are taking advantage of the high fiat market volatility to expand their fiat on-ramps and trading services”
Medalie noted that Bitfinex was the exchange that dominated the activity at the end of September of the volume of trade denominated in pounds sterling which reached all-time highs, this led two weeks later to Bitfinex expanding wire transfers to include sterling via a faster payment service.
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