New York, Wednesday, July 24, 2024 – Major cryptocurrency exchanges are tightening rules around who qualifies for discounted trading fees typically offered to large clients.
This move follows recent actions by leading exchanges Binance and OKX.
The exchanges are cracking down on practices where prime brokerages, firms serving professional investors, bundle client orders to qualify for lower VIP fees. This practice disadvantages smaller investors who don’t have access to such arrangements.
OKX, the world’s second-largest crypto exchange by trading volume, recently requested detailed information from prime brokers.
This information includes the identities and locations of entities or individuals behind each sub-account used for bundled trading. The deadline for this information was July 17.
Non-compliance could result in trading restrictions or account closures for undisclosed sub-accounts.
Earlier this month, Binance, the largest crypto exchange, made changes to its fee structure, effectively closing a loophole exploited by prime brokers.
This loophole allowed them to offer rebates to clients through a tiered fee system. Binance stated the change was made to ensure “a level-playing field for all users.”
While other major exchanges like Bybit haven’t announced changes to their fee structures yet, they are closely monitoring the situation. Regardless of future actions, this move signifies a growing focus on fair and transparent fee structures within the cryptocurrency exchange industry.
