While the Binance cryptocurrency platform has generated a lot of positive headlines for its fiat currency capabilities and exchange traffic, a new acquisition is raising eyebrows and leading to questions about how this kind of consolidation will affect the crypto market.
Today Dalmas Ngetich at Coingape reports on Binance’s acquisition of the CoinMarketCap reporting platform for a projected $400 million.
Onlookers point out that Binance control over one of the biggest crypto tracking platforms may abstract the established role of this listing service in terms of the overall playing field.
Analysts suggest that Binance is perhaps trying to get hold of CoinMarketCap in order to utilize its massive volume of user traffic.
Otherwise, says Larry Cermak, Research and Analysis Director at The Block, it doesn’t quite make sense.
“This acquisition doesn’t make much sense to me,” Cermak tweeted today in response to deal news. “But a simple explanation is that Binance wants to get access to CoinMarketap’s 207.2 million traffic it got in the last 6 months.”
Another possible goal behind the acquisition may be to position Binance better against some main competitors, such as Coinbase, to which BNB is often compared.
“Binance and Coinbase are both great choices for newbie traders,” writes BitDegree Jan. 28 in a detailed comparison of the two platforms on security, user support, trading limits and other factors. “My recommendation is to use them both! Start by opening an account with Coinbase. Make a few simple trades with Litecoin or Ethereum and then, when you feel ready, move over to Binance. Coinbase is the perfect introduction to crypto trading and Binance is one of the best places to continue your crypto education!”
Binance’s leader, Changpeng Zhao, generally enjoys a pretty solid reputation in the cryptocurrency world. Let’s see how Binance use of CoinMarketCap changes the ways that the exchange is perceived as a central venue for coin traders.
