Cryptocurrency exchanges are making millions of Dollars

Cryptocurrency market is becoming a billion dollar business

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In every fight, there is a winner and a loser. This is the case with digital-asset exchanges which are emerging as great winners in the cryptocurrency market. The ten best exchanges are generating more than $3 million in fees daily. This is slightly more than $1 billion annually according to Cryptona reports and also a compiled report from the exchanges’ websites on fee information.

They operate through projections which are estimates because it’s not possible to know exactly how much closely held firms are charging. This includes discounts for the most active traders. But despite all that when we look into daily trading volume and also the listed fees the annual revenue for the best 10 moves to billions of dollars. These numbers are however not exact, but the order of magnitude show that cryptocurrency market is growing and is generating some fresh and real cash.

According to Gil Luria who is an equity analyst at D.A. Davidson & Co:

“The transaction process and also the exchanges are the biggest winners in the cryptocurrency space because they allow people to do transactions and participate in this burgeoning sector. The sector has a huge business, and it’s not a surprise if they are making hundreds of millions when it comes to revenue collections.”

The largest trading exchanges are Binance and OKEx which handle the largest trading volume which goes up to $1.7 billion per day. They are closely followed by Huobi, Bitfinex, Upbit and Bithub which process $1.4 billion of the trading volume daily. All these exchanges are found in Asia. The Asian influence is due to the concentration of mining in the region because of cheaper electricity costs and also the regions young population.

Binance is very prominent considering the fact that it only started its operations in July. The exchange started in Shanghai and then relocated to Japan after China banned Bitcoin trading. The firm can process 1.4 million orders within a second making it one of the fastest in the market. Its growth may also be accredited to its loose customer accreditation process.

According to Chris Slaughter who is the co-founder of Samsa:

“Binance does not make its users do through the know-your-customer process which is mainly followed by withdrawal. The process is very complicated, and it makes many exchanges lose customers. Binance has made everything simple, and you can go from having no account to having funds already deposited in less than 20 minutes.”

There many other exchanges like Upbit which started last year and had already taken over the market because of offering customer-friendly process. They are however expected to face tight competition in the future from public companies and also traditional financial firms which may force the exchanges to become more transparent and even reduce transaction costs.

Slaughter concluded by stating that:

“It’s very likely that more conventional businesses like banks will acquire crypto platforms to make sure that they are strategically placed on the market. This will increase competition which will lead to reduced transaction costs which will help the investors.”

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