Binance’s Web3 wallet reached peak market share after OKX suspends DEX aggregator service

Source Cryptopolitan

Binance Wallet, one of the widely used Web3 services, reached peak volumes on Wednesday. The wallet took over traffic after OKX suspended its DEX aggregator service. 

Binance Wallet became the most popular Web3 interaction tool, with daily volumes surpassing $90M. The wallet took over Web3 traffic and DEX activity after the OKX wallet suspended its DEX aggregator service. 

In the past two days, Binance Wallet expanded its share of overall daily users. Right after the announcement by OKX, the wallet took over 54% of the market. A day later, the share already expanded to 66%. 

Binance Wallet expanded its influence among other Web3 wallets after adding new liquidity features.
Binance Wallet expanded its influence among other Web3 wallets after adding new liquidity features. | Source: Dune Analytics

Binance Wallet usage also coincided with a general increase in BNB Smart Chain usage and DEX activity on PancakeSwap. The shift may be temporary, as OKX has only suspended its DEX aggregator to achieve improved compliance. The other short-term reason for the increased wallet usage was the launch of the Bubblemaps (BMT) token on Binance. The asset was among the day’s trending tokens, further boosting the wallet’s activity.

The other reason for the expansion of Binance Wallet usage is the special bonus period with zero additional trading fees. The ability to trade the newest memes without additional expenses drove the wallet to the leading position. The wallet also retains the advantage of having a native chain, which other Web3 wallets lack, relying on multi-chain access. 

Binance’s ecosystem is trying to expand more aggressively after Ethereum and Solana are showing signs of user outflows. The wallet has also added new features, including exclusive access to TGE launches, token filtering and selection features. 

OKX loses traffic after becoming a tool for Lazarus hackers to launder funds

OKX Web3 wallet previously carried up to 50% of traffic, due to multi-chain access and high demand for the available DEX. After removing the aggregator, the wallet’s share fell to 3.6% of all activity.

As a Web3 wallet, OKX was used anonymously and carried some of the traffic from the recent Bybit hack. For that reason, OKX will increase its compliance mechanism. The OKX Web3 wallet used THORChain, which managed to obscure some of the swaps. OKX is trying to secure its role in DeFi space, as it turned out protocols were not ready to track down and freeze funds from hacking activities. 

OKX claimed its Web3 platform was open to anyone, but the recent activity showed protocols could choose to track down funds and probably were complicit with the losses. There is no unified standard on freezing funds, but OKX will change its access to filtering and aggregating transactions. 

Binance shifts the balance of Web3 wallets

The sudden activity spike may also be linked to a new feature that further consolidates the ecosystem. The owners of Binance balances on the centralized exchange can now directly bid on decentralized tokens. 

Binance Alpha 2.0 launched for the Chinese-speaking regions, explaining the rapid spike in Web3 activity during Asian trading hours. Binance’s approach to expanding token selection without listing is similar to the Coinbase verified pools, offering curated access to relatively safer liquidity pairs. 

The BNB Smart Chain also produced $1.63M in fees for the past 24 hours, surpassing TRON (TRX) to become the sixth-largest fee generator for the past day. BNB Smart Chain also raised more fees compared to Ethereum and Solana put together. The shift to new meme tokens shows there is still a search for highly active crypto assets. Despite the slow altcoin season, liquidity hubs and accessible infrastructure remain the key to retaining on-chain activity.

Currently, Binance and Coinbase are the only centralized exchanges with a highly active native chain. This has allowed the crossover between centralized activity and Web3. In the past months, liquidity was mostly split between CEX and DEX, but Binance unleashed its peak user base and assets to flow back into DEX activity. 

Following the peak wallet usage, the native token BNB took a step back, to trade at $618.84. In the past few days, BNB maintained its price above $600, mostly driven by new demand for meme tokens.

Binance has the additional advantage of integrating Four.meme tokens, in addition to the hand-picked daily Alpha selections. Other exchanges lack the integrated ecosystem to offer extended lists of tokens and safe DEX aggregation.

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