Despite the end of Binance’s ‘zero commission’ promotion, FDUSD trading dominance continues.

adminJune 19, 2024

At the end of April, Binance made another change to its spot fee tiers. Binance has specifically ended its “Zero Trading Fees” promotion for several pairs.

We have talked about Binance and FDUSD in the past. Binance appeared to be relisting its stablecoin to replace BUSD after the stablecoin was shut down. To drum up excitement for the stablecoin, which was previously delisted in favor of its own stablecoin, the pair, which uses FDUSD as its quoted asset, was initially listed with favorable fee rates. In particular, BTC/FDUSD was trading for free.

After taker fees were imposed on the BTC/TUSD pair, BTC/FDUSD became the only free way to trade Bitcoin on the world’s largest cryptocurrency exchange. This has helped the relatively small stablecoin gain attention.

In December, Binance appears to have also made other major FDUSD pairs available for free trading as part of a wider promotion.

FDUSD continues to stand out on exchanges, with the stablecoin pair accounting for more than 35% of the exchange’s spot trading volume in April, surpassing the highs set by TUSD, Binance’s previous attempt to succeed BUSD. In December 2022, the BUSD pair accounted for 39% of exchange volume, but FDUSD has proven to be a worthy competitor, accumulating dominance in a much shorter period of time.

However, on April 25, Binance ended its commission-free FDUSD trading promotion for both Bitcoin and the pair, which became available for free trading in December. There is still a zero maker fee promotion for all pairs, but a similar promotion still exists for TUSD.

FDUSD’s dominance has been waning since the end of the promotion, but it still stands out, accounting for 33.55% of spot trading in June.

Note: This chart is only available to The Block Pro subscribers.

However, the popularity of BTC/FDUSD does not seem to be cooling down. The pair recorded a volume of $4.5 billion in the last 24 hours, compared to $2.5 billion for BTC/USDT and $9.6 million for BTC/TUSD. However, for other spot assets, the USDT USDT pair is dominant.

Trading many FDUSD pairs is still slightly more advantageous due to the no-maker fee, but it is not as powerful as a draw. USDT is a larger and more well-known stablecoin, which is still preferred even without incentives.

The USDT pair may eventually face pressure from the EU on exchanges as they seek to comply with MiCA regulations, but it is unclear how much of Binance’s trading volume comes from the European bloc.

Nonetheless, the end of free trading does not seem to have had much of an impact on FDUSD.

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adminJune 19, 2024