Binance reduces Ethereum transaction fees to 0. Binance thinks big and starts reducing transaction fees on Ethereum to 0! The popular decentralized exchange platform wants to raise itself even further as the undisputed leader. With this news, the CEO, Changpeng Zhao, hopes to accelerate the symbolic milestone of 1 billion users on the platform, for their crypto exchanges.
Even if this operation has already taken place on other tokens such as BNB and BUSDT, ETH now enjoys a special status. Its next transition, The Merge, will allow it to offer almost zero transaction fees. To answer this, Binance hopes to encourage players to trade Ethereum on their platform by sticking to the new Ethereum price standards.
Transaction Fees: a frantic race since Robin Hood
Binance is not the first platform to offer zero transaction fees. It was Robin Hood who democratized this service, which also allowed him to obtain such a large market share. Even if the GameStop affair has greatly shaken its current popularity, it remains the pioneer in this field.
A competitive problem above all
Changpeng Zhao says his intentions are purely philanthropic, but there's no denying that this is also a golden opportunity for him. If it can be believed to actually value cryptos as a way to break free from traditional finance, Binance has a lot to gain as well.
When looking at the market, reducing transaction fees proves to be essential in terms of competitiveness for Binance. Many other platforms like Strike are zeroing in to catch up with the market. Crypto wallet services are no exception and do everything to keep their share of users.
Newcomers like Swan Bitcoin threaten the hegemony of the big structures by limiting intermediaries. They offer to buy Bitcoin in seconds just with a bank card. For the big cryptocurrency platforms, it is necessary at all costs to consolidate their leadership position, even if it means making concessions.
Binance largely makes up for it by taking commissions on futures trading at 10% fees. It also does this on spot trading fees, as well as other stablecoins.
Binance takes advantage of The Merge to get new customers
Binance has calculated its move well by proposing this reduction right when The Merge of Ethereum will come to an end. The volume of transactions is at its highest and crushes that of all other products in the industry. At the moment, ETH is the star crypto.
It greatly exceeds Bitcoin in terms of the number of transactions carried out. It will even have reached a historic peak of 1.679 M trades on July 26, 2022. Currently, ETH is stabilizing around 1 million trades.
ETH Trading Volume in Last 3 Months - Ycharts.com
With their announcement of “0 fees”, Binance hopes to win over a lot of users in the long run. It remains to be seen whether the strategy adopted by the company will bear fruit.
Binance maintains its lead with a solid strategy
Binance stands out from the rest for its stability and the relevance of its offers. The company has been able to stay in the crypto landscape without making waves. It is today the safest platform to exchange your digital currencies.
For Binance, this kind of offer is not really harmful. Most of the profits are established on stablecoins rather than this kind of asset. Binance has therefore secured an alternative income that allows it to offer this kind of fee on ETH without constraints. It should also be noted that the latter have created their own stablecoin in BUSD. This gives them a definite advantage over their competitors.
To conclude, Binance seems to succeed in its bet by establishing its dominance in the market a little more. With zero fees, the remaining investors may well be convinced by the most successful platform of the moment.
Should you buy ETH on Binance?
With such an announcement, there really isn't much stopping you from buying ETH on Binance. The platform gives you everything you need while saving you transaction fees. With The Merge just around the corner, you can even invest a bit in future shorts. They will compensate for a possible loss on ETH.
In short, Binance is suitable for all investors and all types of strategies.
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