Coinspeaker
Bernstein: Binance to Maintain Global Dominance after Settlement with US Authorities
In the aftermath of Binance’s recent settlement with the United States government, industry analysts at Bernstein are confident the company will continue to maintain its position as the leading global cryptocurrency exchange in the industry.
According to a research report by Bernstein, despite facing minor outflows of less than $1 billion, Binance demonstrated resilience, with customers exhibiting minimal panic.
Binance Shows Resilience in the Face of Turmoil
The Bernstein analyst, led by Gautam Chhugani, said that Binance maintained its reputation with non-US retail customers and remained robust throughout the crisis. The report predicted that Binance will remain a significant player outside the United States.
However, Bernstein anticipates an uptick in competition, pointing to established rivals like Coinbase (COIN) and emerging exchanges in regulated markets such as Hong Kong and Singapore.
Under the company’s former leader, Changpeng Zhao (CZ), the crypto exchange expanded its global presence across many countries in the Middle East, Europe, Asia, Africa, and other parts of the world.
As the leading global crypto exchange, the company has more presence in many jurisdictions worldwide than its competitors, such as Coinbase, CryptoCom, Kraken, and Gemini. Some of the countries in which Binance received operational licenses include Mexico, New Zealand, Australia, Kazakhstan, El Salvador, Indonesia, and Thailand.
Addressing Concerns and Regulatory Impact
Responding to concerns about the substantial $4.3 billion fine imposed on Binance, Bernstein reassured stakeholders that the crypto exchange holds ample funds to settle the penalty while maintaining healthy operations.
However, the analysts caution that a complete withdrawal from the US market could pave the way for onshore and incumbent exchanges to dominate the US landscape.
The report notes that asset managers in the country pursuing crypto-related exchange-traded funds (ETFs) are already forming collaborations with exchanges like Coinbase for prime broking and custody services. Additionally, Bernstein sees the Binance settlement influencing the regulatory landscape positively, offering a pathway for the approval of a regulated Bitcoin (BTC) spot ETF.
“In our view, this is the final straw before the establishment feels comfortable to approve a regulated bitcoin ETF,” the report stated.
Industry Consensus and Positive Outlook
Bernstein analysts are not the only experts who believe Binance will remain the world’s leading crypto exchange despite the recent settlement with the US authorities on Tuesday. Matrixport, a crypto services provider, said the deal will have a favorable outcome for Binance’s founder, CZ, and the company.
Despite the Securities and Exchange Commission (SEC) being excluded from the settlement, Matrixport asserts that Binance will likely remain a top-three exchange in the short term.
Like Bernstein, Markus Thielen, head of research at Matrixport, suggested the settlement could significantly raise expectations for a spot BTC ETF.
“With this plea deal, the expectations for a spot bitcoin ETF might have increased to 100% as the industry will be forced to follow the rules that TradFi firms must follow,” wrote he.
Bernstein: Binance to Maintain Global Dominance after Settlement with US Authorities
