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Binance Close to Matching BitMEX When It Comes to Liquidity: Research

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Tue, 02/04/2020 - 19:35
Alex Dovbnya
BitMEX is still the most liquid perpetual contract exchange but Binance is now breathing down its neck
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Malta-based Binance is close to reaching BitMEX's level of liquidity, according to data provided by crypto research company Skew. 

image by @skewdotcom

As of now, Binance has a bid-offer spread of 50 basis points (BPS) for $10 mln compared to the 25 BPS spread on BitMEX. As the chart below shows, the gap between the two exchanges has been drastically reduced in January. 

Exchanges with the lowest bid-offer spread boast the highest level of liquidity. 

Related
XRP Can Now Be Traded Against Euro on Binance

Negative fees for increasing liquidity  

Recently, Binance moved to increase the liquidity of its futures platform by rewarding market makers. The exchange made an announcement about implementing negative trading fees.

In order to qualify for the program, traders need to record at least 1,000 BTC in monthly trading volume on Binance or other exchanges. 

Related
XRP On-Demand Liquidity Flows Trialled by Binance? Community Assumes So

Binance Futures hits its stride  

The aforementioned fee structure adjustment is meant to spur more interest in Binance's futures platform that has to compete with the likes of BitMEX, CME Group, and Bakkt. 

Back in December, CryptoCompare estimated that Binance’s BTC perpetual future was the third most traded derivatives product by monthly volume. 

In January, Binance Futures debuted eight new futures products, including the TRX/USDT perpetual contract.   

About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets.

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