Binance was once a place where Americans could easily access a huge pool of altcoins with decent exchange features. It allowed people to search for the diamond in the rough altcoins that might a huge upside. By the same token, those pipe dreams of mooning altcoins took large amounts of money out of the American citizens hand. This ultimately resulted in Binance blocking U.S. users from their exchange and requiring proof of residency to use it. On September 11th, a Binance representative tweeted out that their U.S. government friendly exchange would be releasing in the coming weeks.
Binance.US limited selection looks like a second Coinbase
People get excited when a coin is listed on Coinbase because of their wide reach and limited selection. Only 16 projects have met the Coinbase Digital Asset Framework requirements compared to Binance’s 100 plus listings.
In order to gain favor of U.S. regulators, Binance is trying to look like Coinbase. The Binance team announced 30 crypto assets that they were “exploring” in August 2019. From the hundreds of coins they embraced in the past, the narrow selection may be a shock to Binance fans.
Out of the 30 assets being explored, 17 are not listed on Coinbase. This matters because the Binance’s biggest differentiator has been allowing access to as many coins as possible, and helped it become one of the fastest growing crypto exchanges. The aspect of the exchange that made them stand out is now being taken away from users.
Coinbase has spent years building trust with consumers interested in purchasing 13 out of 30 of Binance’s asset contestants. Out of the top 10 highest market cap coins, the only one on Binance that isn’t on Coinbase is their own BNB.
How the exchange has differed from Coinbase
Going back to the pipe dream appeal of Binance, the exchange has always been more friendly to users who don’t have much money. They gave traders access to cheap coins during a time where many unknown projects increased 1000% in value. This appealed to the user who couldn’t purchase a whole Bitcoin, but was under the impression that other coins have similar upside potential.
While the Coinbase Pro exchange doesn’t charge exorbitant fees, Binance has always been cheaper in comparison. Maker/taker fees on Coinbase Pro sit at 0.15% while Binance defaults to 0.1%. This may not seem like a big difference, but it can cut into profit margins of people who scalp price. On top of the cheaper fees, if users hold a bag of BNB, their fees are reduced by 25%.
Other than that, Coinbase pro and Binance both have limit orders, stop loss orders, and an orderbook. Binance exchange does benefit from having additional indicators, drawing tools and charts linked to Tradingview. Most modern traders chart directly from Tradingview because there are more options to save and split charts so this is not a make-or-break deal.
Binance does have a desktop and mobile application that carry all the same features as the browser version. The Coinbase App does not include any features from the Coinbase Pro exchange.
Ultimately, the biggest difference between the two sites is that when “altcoin season” was happening. Traders would send Bitcoin over to Binance to try to take advantage of the pumping prices of coins that they possibly had never heard of before.
Will Binance win over U.S. traders?
Binance.US is clearly a defensive release. No matter how confident CZ is about Binance on twitter, U.S. traders were their largest demographic. These users now have less access to the once appealing features of the website and they have to comply with KYC regulations.
The success of this exchange largely depends on whether or not the 17 extra coins and 0.075% reduction in fees are worth leaving Coinbase Pro for. If there truly another altcoin season in the future, traders will move their coins over to Binance but those are historically short lived.
Right now, Coinbase and BitMex are the big winners in the crypto exchange space. Coinbase is trusted, complies with the government, and makes it easy to take the first step into investing in crypto. BitMex allows traders to use high margin with no KYC restrictions, low fees and arbitrage opportunities. In the U.S., the best Binance can do is .075% off fees and a mobile app to trade on.