Coinbase and Bybit Maximized the Benefit from Binance Agreement with the DOJ

Following Binance recent $4.3 billion agreement with U.S. authorities, there was a significant shift in the landscape of crypto companies. The primary beneficiaries of this situation were Coinbase and Bybit, according to data provided by Kaiko.

Despite experiencing outflows that exceeded $1 billion after the agreement, Binance managed to maintain its position in terms of liquidity, according to a study conducted by analyst Riyad Carey. Although it conceded a portion of its market share, Binance’s market depth increased after the agreement.

Coinbase, on the other hand, witnessed a substantial increase in its stock price. Although it was already performing well in November, Binance’s agreement further boosted the value of Coinbase’s shares (COIN), which surged by over 75% during the month.

As for Bybit, it stood out as the “immediate winner” in terms of market share after the agreement. Using Bitcoin as a reference due to its high volume, Bybit experienced growth of more than 20% in 16 out of the 24 hours following the agreement. Given Binance’s significant influence, even with a 4% decrease in market share during certain hours, Bybit saw a substantial increase of 50%, and Coinbase experienced up to a 34% gain.

Despite Everything, Binance Holds Its Ground

Despite losing some market share, Binance managed to maintain its position in terms of liquidity in cryptocurrency markets. While Bybit is closing the gap in terms of liquidity, Coinbase still lags slightly behind in spread competitiveness.

The analyst suggests that, despite theories indicating that Binance might continue to lose market share, enhanced compliance measures and AML/KYC could bolster confidence in the exchange. User loyalty to familiar platforms, despite the availability of other options, indicates a resilience in customer preferences and stability in liquidity and trading volumes.