Leading cryptocurrency exchange Binance has recently revealed it made a $200 million profit in the first quarter of this year. The figure saw various analysts compare the cryptocurrency exchange to well-established companies in the financial sector, with its comparison to Nasdaq standing out.
Dovey Wan, managing director at Danhua Capital, shared on Twitter that Nasdaq, the world’s second-largest stock exchange by trading volume, made $209 million in profit in the first quarter of this year, only $9 million more than Binance.
While Nasdaq is still ahead the comparison is notable, as Binance is an eight-month-old company with about 200 employees, while Nasdaq is 47-years-old and has over 4,500 employees.
Wan’s comparison came after she put Binance’s results against those of Deutsche Bank. The cryptocurrency exchange beat the 148-year-old financial institution’s earnings, even though it has over 100,000 employees. It made a $146 million profit in Q1 of this year.
Some social media users complained, however, that comparing Binance to the Deutsche Bank wasn’t fair as they run very different businesses. Although Binance’s figures are impressive, its CEO Changpeng Zhao has revealed he expects up to $1 Billion in profit this year.
One more adv[ice/ertisement], you want to trade on an exchange that is profitable (especially also one with the lowest fees). A non-profitable exchange is less secure from a business perspective, and tend to cut corners in places. We don't have to.— CZ Binance (@cz_binance) August 31, 2018
The exchange has, earlier this year, had to halt trading after trading irregularities surrounding Syscoin (SYS) were spotted on the platform. The lesser-known cryptocurrency saw its price jump to as much as 96 BTC (around $640,000 at the time) per coin.
In response to the incident, Binance launched a security fund – the Secure Asset Fund for Users (SAFU) – and revealed it’ll allocate 10% of trading funds to it, to protect users from similar situations.
Despite the company’s success, Zhao has noted it doesn’t plan on competing with other leading cryptocurrency exchanges like Coinbase and Gemini for dominance in the United States. Instead, the company is working on other markets, with its Binance Uganda exchange – its first-ever fiat-to-crypto platform – being part of it.
Binance, as CryptoGlobe covered, is also looking to be less dependent on its core platform. Its Binance Labs startup incubator is set to invest $500,000 in crypto startups for a 10% stake of their business. Its goal is to find the blockchain use cases that’ll help it “thrive.”
Similarly, earlier this year the firm launched a $1 billion blockchain startup fund. While the fund will be paid in Binance’s own BNB token, it isn’t yet clear how the firm will hand over the $500,000 to crypto startups it invests in.