Svmuu News: Crypto influencer Phyrex posted on X, stating, “BitMart and BitMEX didn’t go under because of a sudden collapse; this is very different from FTX’s downfall. For these two exchanges, it was primarily due to operational issues.”
According to him, back in 2023, BitMart approached some of his associates to discuss an acquisition; they even compiled a lot of data at the time, but the matter ultimately came to nothing. In fact, the decline of many third-tier exchanges is partly due to the impact of “Binance” Alpha.
Small exchanges have always been hotbeds for all kinds of altcoins, pump-and-dump coins, pyramid scheme coins, and community-backed coins. However, the emergence of Alpha provided these coins with better outlets, leading to a sharp decline in listing fees for third-tier exchanges and a significant reduction in their profits from collusive market manipulation.
Another reason is trading mentors. While there aren’t actually that many of them, they have a constant stream of followers. These mentors typically move between various exchanges; as soon as a new exchange offers better profits, they’ll quickly lead their followers to switch platforms. The recent high-profile cases of exchanges that have gone under generally followed this pattern.