These 4 platforms dominate the market of bitcoin and cryptocurrency exchanges.
In recent months, the market for bitcoin (BTC) and cryptocurrency exchanges has noticeably swung in favor of four platforms in particular. Since July last year, Binance, Bitfinex, Bittrex, and FTX have increased the combined balance of BTC under their umbrella by more than 24%. The most recent report from analyst firm Glassnode reflects the growth in the balance sheets of these exchanges. In net numbers, between the four of them, they brought in more than 200,000 BTC, passing the cumulative total of 1 million. More than half of these BTC are deposited in Binance and Bitfinex, clear leaders in the bitcoin and cryptocurrency exchange market. Between them, they have accumulated some 800,000 bitcoins, according to a graph in this week's Week on Chain report.
In the case of Binance, this platform has under its safekeeping more than 20% of the BTC of the exchange sites, as we have previously reported in CryptoNews. A remarkable increase considering that between 2018 and 2020, they remained hovering around 8% in that section, Glassnode exposes. This behavior coincides with a significant accumulation on Binance, which has seen its balance of BTC deposited by users increase by about 315,000 BTC since 2020. A 120% increase in two years, the researchers note.
The increase in bitcoins deposited in Bitfinex is also remarkable: it has quadrupled between 2020 and today. According to records from the same firm, from just under 60,000 BTC in November of that year to more than 250,000 by March 7, 2022. Bittrex, while also gaining more BTC in that period, has done so much more modestly: its increase has been from about 92,000 to just over 127,000 BTC between November and the current date.
FTX, a competitor on the rise
The other notable case within the exchange market is FTX. The platform focused on bitcoin derivatives and other cryptocurrencies has burst into the industry with great force, with significant capital injections that have translated into a sustained increase in its volumes. According to figures from Glassnode, this exchange has gone from holding less than 1% of total BTC on exchange platforms to around 4%. Comparing it to more than 20% of the market dominated by Binance or Coinbase seems minor, but the increase is impressive, analysts point out. For the analyst firm's researchers, the growth of FTX and Binance appears to give a clear message about the state of the market and where traders' interest is placed in recent times: "using derivatives to hedge risk, rather than spot BTC sales." To complete that scenario, the report states that both exchanges have increased their dominance of the futures market (one of the types of derivatives traded).
The rest of the exchanges see their bitcoin reserves drop.
In contrast to the situation experienced by the four exchanges mentioned above, others have only seen their reserves decrease. The cumulative balance among all trades has dropped from 2020 to date: from about 3 million to about 2.5 million BTC in total. Huobi leads this negative side of the exchange market, with a catastrophic drop: from more than 400,000 BTC they had at the beginning of 2020, they now have less than 13,000.
"More than half of this balance decline has followed the Chinese government's ban on Bitcoin mining and other restrictions imposed on investor activity in May last year," Glassnode notes. Huobi, despite being founded in China, is currently headquartered in Seychelles and has offices in the United States, Japan, South Korea, and Hong Kong.