Updates on Zero‑Fee Bitcoin Trading

In recent years, the concept of zero‑fee Bitcoin trading has transformed the cryptocurrency landscape. From Binance’s aggressive fee waiver programs to growing competition among exchanges, fee‑free trading has significantly influenced market dynamics, liquidity, and regulatory scrutiny. In this blog, we'll explore the latest developments—what’s changed, why it matters, and how traders are responding.

1. Historical Background: Binance’s Zero‑Fee Strategy

Binance first launched zero‑fee Bitcoin spot trading in July 2022, covering 13 BTC trading pairs including BTC/USDT, BTC/USDC, BTC/TUSD, and more (Binance). That move was a major incentive to drive volume and user acquisition. Within months, Binance’s BTC spot volume dominance rose sharply, claiming upwards of 20% additional market share compared to rivals (FXStreet, Cointelegraph, Reddit).

By March 2023, Binance ended zero‑fee trading on 12 of those 13 pairs, retaining the waiver only on the BTC/TUSD pair. That cut reportedly affected around 60% of the volume the waiver generated (Reddit). A mid‑2023 survey reflected that even with only one fee‑free pair left, Binance still held approximately 95% of the global Bitcoin spot trading volume (Reddit).

2. Recent Developments & Regulatory Signals

• On August 24, 2023, Binance announced that beginning September 7, 2023, it would modify the BTC/TUSD pairing: zero maker fees would remain, but taker fees would resume, tiered according to VIP level (Cointelegraph).

• Originally, the fully zero‑fee program had no maker or taker fees on the BTC/TUSD pairing (Binance). After the update, while makers still benefited, takers would pay fees depending on VIP tier, and trading volumes from this pair would count toward VIP status and liquidity provider programs.

• Binance CEO Changpeng Zhao openly raised concerns about wash trading incentivized by zero‑fee programs. To mitigate abuse, trades on zero‑fee pairs were excluded from VIP and liquidity tier calculations—or in the case of BTC/TUSD, later included only under revised criteria (Cointelegraph, InsideBitcoins.com).

• Regulatory pressure has played a role as well—Cointelegraph and Investing.com track Binance’s market share decline, especially post zero‑fee promotions, with Binance’s spot market share dropping from over 50% to figures between 33–46% by mid‑2023 (Cointelegraph).

3. Binance’s Ongoing Dominance Despite Cuts

Despite abolishing most zero‑fee BTC pairs, Binance maintained dominance. As of early 2023, there was still around 95% of Bitcoin spot trading volume on Binance, even after the fee waivers were mostly removed (Reddit).

Binance itself acknowledged that pausing zero‑fee promotions was expected to erode some market share—but framed this as part of a broader strategy focused on compliance, regulation, and long‑term sustainability (Cointelegraph, in.investing.com, InsideBitcoins.com).

4. Other Platforms and Emerging Alternatives

As Binance backtracked, other exchanges and platforms stepped up with competitive fee structures:

• MEXC emerged as a top contender in 2025, offering zero maker and taker fees on spot trading and a modest fee on futures (~0.01%) for taker trades (NFT Evening). MEXC supports 2,500+ cryptocurrencies and emphasizes security via cold storage and PoR audits (btcc.com).

• Other platforms like Lykke, Deribit, and Phemex also have positioned themselves among top zero‑fee or ultra‑low fee exchanges in 2025 (NFT Evening).

• In the MENA region, Rain Exchange introduced a zero percent trading fee structure back in April 2022, specifically aimed at simplifying trading costs for users in Middle East and North Africa (en.wikipedia.org).

5. Key Trends Driving Changes in Zero‑Fee Trading

5.1 Wash Trading Risk & Platform Integrity

Zero‑fee schemes offered incentives that some users exploited via wash trading. Binance responded by excluding zero‑fee trades from VIP volume counts or implementing monitoring tools to detect abuse (InsideBitcoins.com, Binance).

5.2 Liquidity & Volume Strategy

While zero‑fee offers drive volume constraints, sustained dominance also hinges on liquidity, wallet access, stablecoin availability, and deep markets. Binance remained top‑tier even after most waivers ended because of its liquidity and user base.

5.3 Regulatory Compliance & Sustainability

Exchanges are under growing regulatory scrutiny globally. Binance's shift away from promotions is partially tied to its push for regulatory alignment and risk mitigation in key jurisdictions (in.investing.com, Cointelegraph).

5.4 Competitive Response and Fee Wars

Regional and niche platforms are carving market share—MEXC with truly free maker/taker trades, Rain in MENA, and niche campaigns like LCX offering short‑term zero‑fee promotions on EUR trading pairs until mid‑March 2025 (Reddit).

6. Impacts on Traders and the Broader Market

• Trader Behavior

Zero‑fee structures attract high‑frequency traders, arbitrageurs, and retail newcomers. In contrast, the demise of such programs shifts focus to trading spreads, liquidity and deeper features.

• Exchange Economics

Fee waivers drain immediate revenues but may boost network effects and tier upgrades long‑term. Once promotions end, exchanges face questions about sustainability and monetization.

• Market Structure

Binance’s retreat from zero‑fee trading opened space for competitors. This may decentralize volume and reduce concentration risk—even if Binance still holds significant share.

7. What Lies Ahead?

• Will Binance reinstate fee waivers? CEO Zhao’s public poll in early 2023 showed around 65% of participants wanted fee‑free trading continued, despite inherent risks (InsideBitcoins.com). While broader fee removals seem unlikely, limited or rotating promotions may return based on user demand and market conditions.

• Spot ETF competition is impacting fee dynamics. In traditional finance, spot Bitcoin ETFs lowered expense ratios across offerings—for instance BlackRock reduced fees to 0.12%, while others like Global X offered temporary zero fees until early 2025 (investopedia.com). Such shifts are pressuring exchanges to remain price‑competitive.

• Regional & niche exchanges will continue to innovate around zero‑fee campaigns. For example, upcoming seasonal promotions or tier‑specific waivers could be a key customer acquisition tactic.

• Compliance & risk management will remain crucial. To avoid regulatory scrutiny or abuse, exchanges will likely refine how they monitor and structure zero‑fee offerings.

8. Summary Table: Key Milestones & Status

9. Takeaway Insights for Traders

• Don’t chase zero‑fee alone—look at orderbook depth, liquidity, and fee spreads.

• Beware of wash trading traps or promotions that exclude trades from volume counts or VIP tiers.

• Flexibility and value‑added features, such as staking, security, fiat ramps, and derivatives access often matter more than zero fees alone.

• Know the fine print—some exchanges advertise zero‑fee but limit applicability by pair, VIP level, or time period.

Conclusion

Zero‑fee Bitcoin trading once served as a potent growth engine for platforms like Binance, dramatically boosting user acquisition and market share. But as abuses emerged and regulatory pressure rose, fee waivers were dialed back—still, dominance persisted thanks to liquidity, network effects, and product offerings.

Even now in mid‑2025, the zero‑fee model survives—but in a more fragmented and competitive landscape. MEXC sets the standard for free maker/taker trades, regional players cater to local markets, and exchanges like Binance balance user incentives with regulatory compliance.

For traders, the lesson is clear: zero‑fee is compelling—but shouldn't overshadow deeper considerations like liquidity, order execution, security, and long‑term platform stability.