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The Current State Of Bitcoin On Centralized Platforms
Glassnode's analysis unpacks the stability of crypto giants Binance and Coinbase, while Huobi navigates choppy waters.
Recent insights from Glassnode highlight Bitcoin's continuing reliance on centralized cryptocurrency exchanges (CEXs). Astonishingly, 54% of Bitcoin's on-chain volume, representing 67,300 BTC out of 122,000 BTC, is associated with CEXs.
But what's really drawing attention is the dwindling Bitcoin balance on these platforms, currently at a five-year low of 2.256 million BTC. Leading the pack in Bitcoin volume, Binance stands strong with 691,200 BTC in its reserve. Not too far behind, Coinbase boasts 439,800 BTC, while Bitfinex holds its ground with 320,700 BTC.
Metrics For Assessing CEX Stability
Glassnode's insights go beyond mere numbers. Developed against the backdrop of the FTX collapse, they've presented three analytical metrics to gauge the health of CEXs. First, the Reshuffling Ratio looks at the proportion of an exchange's transactions that are internal over a specified duration. Next is the Reliance Ratio, focusing on the volume of inter-exchange transactions. Finally, the Whale Withdrawal Ratio acts as a measure of how rapidly large BTC stakeholders are exiting CEXs.
Huobi's Fluctuating Fortunes
Among these titans, Binance and Coinbase demonstrate enduring stability. Huobi's statistics tell a different story. Since 2023 began, its holdings have been trending downwards. By June, a significant shift of funds away from Huobi was evident. The earlier part of the year saw the platform rocked by rumors of internal problems, prompting users to pull 6,500 BTC from the platform in just a month, with further withdrawals in July. August brought some respite, with CoinGlass figures pointing to a decrease in withdrawals. Still, Huobi remains much diminished as a global crypto exchange, compared to its 2020 heyday.
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