A Deep Dive into Binance’s Growth Strategy

The cryptocurrency exchange giant Binance has achieved an impressive milestone, reaching 300 million users. According to Kaiko experts, this achievement is largely due to the “liquidity flywheel,” a concept that encapsulates how increased trading volumes and liquidity can attract more users and capital. This article explores the factors behind Binance’s exponential growth and its implications for the crypto market.

Factors Behind Binance’s User Growth

In 2017, Binance captivated its audience with a reliable matching mechanism, a straightforward interface, and rapid asset listing capabilities. This combination resulted in a significant influx of liquidity on the platform. As trading volumes grew, particularly through key pairs like USDT, deeper order books emerged. This enhancement improved execution quality and attracted new capital, creating what Kaiko experts describe as a “liquidity flywheel.”
During the bullish cycle from 2020 to 2021, spreads on major pairs remained tight or close to one tick for most hours. Such efficiency was attributed to professional market makers and superior matching quality. Despite stressful market conditions from 2022 to 2023—marked by leverage reduction, regulatory uncertainty, and regional access restrictions—Binance managed to sustain high liquidity levels.

The Resilience of Liquidity

Kaiko’s report highlights two factors contributing to this resilience: approval of spot Bitcoin ETFs and the enforcement of MiCAR regulation within the EU. By late 2024 and throughout 2025, Binance solidified its role as a primary venue for price discovery in USDT pairs. On December 1st, 2025 alone, Binance processed $20 billion in spot volume across nearly 62 million transactions.
Binance holds approximately a 60% share of global centralized exchange spot volume—a testament to its strong network effects. Its liquidity advantage is underscored by deep market levels across major assets like BTC, ETH, SOL, and XRP.

Market Dynamics During Price Fluctuations

For example, between November 2nd and December 1st of 2025—a period in which Bitcoin’s price dropped by over 21%—the average daily spot volume was $19.8 billion with total trades reaching $613.5 billion. During this time frame, spreads stayed narrow while depth quickly recovered post-fluctuations due to active participation from market makers engaging in arbitrage activities.
Despite volatility during these cycles—the median trade size for BTC-USDT remained small yet stable—indicating healthy retail participation alongside algorithmic executions.

24/7 Liquidity Circulation

Liquidity on Binance circulates around-the-clock without any “dead hours,” especially evident among USDT pairs that support global trading strategies regardless of time zones.
In December of 2025—as noted by Kaiko—Binance secured licensure from Abu Dhabi Global Market (ADGM). Operating via three licensed entities under Abu Dhabi’s regulatory framework positions them strategically within UAE’s evolving digital finance infrastructure.
Through high turnover rates coupled with predictable liquidity models focused on accessible quotes across diverse assets: Binance continues attracting user influx through various market cycles while keeping costs low—a key takeaway emphasized by Kaiko analysts regarding their sustained growth trajectory toward hundreds-of-millions-strong accounts base globally within cryptocurrency space today!