The competition amongst crypto service providers in the United States is becoming real with Binance.US cutting trading fees for select Bitcoin (BTC) trading pairs.
This move is sending the shares of rival brokerage outfits, Coinbase Global Inc (NASDAQ: COIN) and Robinhood Markets Inc (NASDAQ: HOOD) down during Wednesday’s trading session.
At the time of writing, Coinbase is trading at $54.12, down 5.86% in the past 24 hours while Robinhood is down 0.28% to $7.53. The significance of the trading fee cut can notably impact the sentiments towards the duo of Coinbase and Robinhood.
While Coinbase charges fees for its products or hosted trades, Robinhood is largely regarded as a commission-free platform, a model that has largely earned it goodwill amongst millennials and retail investors. With the new move from Binance.US, it means that users will no longer have anything to lose whether they trade the said Bitcoin pairs which are either with US Dollar, USDT, BUSD, or USDC on Binance.US exchange or on Robinhood.
A number of people are poised to try out Binance.US due to this new allowance. Coinbase will be the most impacted as the platform has not yet implemented its zero-fee trading provision.
BTC Fee Cut: What Is in It for Binance.US
The cryptocurrency ecosystem is witnessing a very turbulent time and despite the cut in trading fees, Binance.US seems to be convinced its push is a well-calculated one and that it is coming at the right time.
“Binance.US is offering zero fees on BTC across four pair trades indefinitely as we endeavor to revolutionize the way fees are approached in our industry and increase accessibility to crypto,” a Binance.US spokesperson told The Block, adding that “there is no better time to introduce zero fees than now. We are taking a bold move and providing more value to our customers at a time when the community needs it most.”
While many may say that the cut in trading fees is a bad idea, the exchange noted that Bitcoin is just one of the hundreds of trading pairs on its platform and that it can always generate its revenue from other coins or tokens. The exchange also implied that the fact that it has continued to launch new products and services is also an indication that it has a robust balance sheet that can withstand the loss that the fee cut will cause.
Binance.US said that while its peers spent millions of dollars in advertisements, that is has been able to re-invest into the business, making it well-positioned to handle the cut in fees. The United States arm of the Binance cryptocurrency exchange is valued at $4.5 billion after raising $200 million back in April this year.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
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