Here’s what the on-chain data says regarding which cryptocurrency exchanges are currently the platform of choice for Bitcoin whales.
Bitcoin exchanges are ranked according to their pedigree of whales
In new mail On X, CryptoQuant Community Manager Maartunn discussed which exchange is currently number one in Bitcoin exchange whale ratio.
“Exchange Whale Ratio” here refers to an indicator that tracks the ratio between the sum of the top 10 exchange flows and the total exchange flows for a given platform.
The top 10 inflows to the exchange are generally considered to come from whale entities, so the value of this metric tells us what portion of the total inflows to the exchange are made up by these mega investors.
Now, here’s a chart shared by Maartunn that shows how the percentage of Bitcoin exchange whales has changed for various exchanges in the sector over the past decade:
Looks like Coinbase currently has this metric at the highest value | Source: @JA_Maartun on X
In the chart, the blue shade corresponds to Bitcoin exchange whale ratio values close to 0, red to those around 0.5 and yellow to those close to 1. It appears that although most exchanges have a shade of blue, Coinbase It has been characterized by a solid yellow line for a while now.
This indicates that whales are directing almost all of their Bitcoin flows to Coinbase. In contrast, other exchanges saw retail exchange flows dominated, including Binance, the largest cryptocurrency platform by trading volume.
The chart shows that although Coinbase has dominated whale activity this year, this was not always the case. The platform’s growth as a home for whales can be linked to one event: the launch of exchange-traded funds (ETFs).
Spot ETFs finally received approval from the US Securities and Exchange Commission (SEC) at the beginning of this year. Since then, these new financial instruments have gained popularity among investors.
An instant ETF allows investors to gain indirect exposure to BTC price movements, meaning they don’t have to own any real BTC tokens; Spot ETFs buy and hold coins on behalf of their users instead.
Now, spot ETFs must store BTC securely in some way, and for this purpose, most of them have chosen Coinbase as their custodian. This unique position that the platform has gained in this sector could explain why whale flows to the platform have increased this year.
Bitcoin price
Bitcoin saw a pullback below the $67,000 level earlier in the day, but the asset appears to have recovered as its price is now trading around $67,200.
The price of the coin seems to have been enjoying bullish momentum recently | Source: BTCUSDT on TradingView
Featured image by Dall-E, CryptoQuant.com, chart from TradingView.com