Cryptocurrency

Binance holds the most amount of Bitcoin on exchanges after roles have reversed with Coinbase

Exchange balance refers to the amount of Bitcoin that exists on exchanges, and both Coinbase and Binance have been trending downward since January 2022, but suddenly Binance’s exchange balance reversed, and in May began to soar. While both overall and Coinbase exchange balances continue to decline, it is still increasing.

Bitcoin exchange balance
Bitcoin exchange balance (via Glassnode)

The chart above shows the cumulative Bitcoin exchange balance, Bitcoin price, and the exchange balances of both exchange giants Binance and Coinbase.

The green line representing cumulative exchange balances has followed a sharp downward trend since February. Earlier this year, he had over 2.6 million Bitcoins on exchanges. This number is now below 2.4 million, demonstrating a net outflow of 200,000 bitcoins.

This means that bitcoin supply has been removed from exchanges, indicating a long-term bullish holding trend.

coin base

Coinbase is following the same trend as the overall balance. The exchange held around 690,000 bitcoins at the beginning of the year, but in eight months he has fallen below 560,000.

Bitcoin exchange net position fluctuation
Bitcoin Exchange Net Position Change (Source: Glassnode)

The chart above shows coin movement on Coinbase. The red line represents Bitcoin going out of the exchange and the green represents the incoming balance. Coinbase has been withdrawing a significant amount of bitcoin since the beginning of the year. In addition, withdrawals doubled once between March and May. And again in July.

The fact that US financial institutions prefer Coinbase may have played a role in these deals. In the face of a bear market, institutional investors were more likely to operate on a buy-and-hold basis, which may have motivated them to withdraw Bitcoin from Coinbase.

binance

Despite being caught in the same downtrend earlier this year, Binance has earned more Bitcoin than in January. The exchange saw him start the year with 586,000 BTC, by May he was below 560,000, and in August he finished with 623,000 BTC.

The chart above reflects the decline of Bitcoin reserves from February to May, after which the order changes.

Bear Market Coinbase and Binance

Judging by the news over the past few months, Binance and Coinbase are treating the winter market differently. Binance is undaunted by the harsh winter conditions and continues to put its customers first, while Coinbase is dealing with layoffs, lawsuits and bankruptcy speculation.

binance

Before the coldest winter in cryptocurrency history begins, Binance US is valued at $4.5 billion in a seed funding round, with the exchange taking its first steps towards expansion in Abu Dhabi. Binance continued to invest and hire after winter started. Binance CEO Changpeng Zhao has even said that the company is in a very wealthy position and will soon start acquiring other companies.

coin base

Coinbase, meanwhile, was dealing with bankruptcy language in its quarterly report just before winter began. Soon after, a Coinbase user lost his Wormhole Lunas when he tried to transfer money to an exchange, but Coinbase refused to help at that point. The exchange was then sued by a customer and his Craig Wright. In addition to dealing with them, Coinbase’s staking product is also the subject of his SEC investigation.

Meanwhile, the exchange laid off new hires, citing market conditions, and laid off 1,100 employees after a petition to executives. Finally, according to Goldman Sachs, Coinbase’s revenue could drop by 61% due to winter conditions, and the company may have to lay off even more employees to survive.

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