Binance Leaves Behind Coinbase With Bitcoin Holdings

Crypto exchange Binance has overtaken rival Coinbase to hold the most Bitcoin in the world. 

Binance Holds Most BTC

The two exchanges have been rallying at opposite ends of the spectrum. While Coinbase has been taking hit after hit in the bear market, Binance has been going full steam ahead. In the latest lap of their race, Binance has overtaken Coinbase as the exchange with the largest Bitcoin holdings globally. Coinbase Global used to hold around 1 million BTC back in 2020. However, with users selling off their Bitcoin, Coinbase’s funds have suffered tremendously, causing them to fall behind Binance. 

Users Rejecting Custodial Ownership

A primary reason behind Coinbase losing out on funds is the nature of its digital assets storage. Being a centralized exchange, Coinbase stores 98% of all users’ digital funds on cold wallets. Even though it is the safest form of storage as it involves holding digital assets in physical hardware disconnected from the internet, it also reduces users’ control over their assets. This custodial ownership led to many users backing out of Coinbase and withdrawing their funds as they believed in the saying, “Not your keys, not your crypto.” Instead, investors are choosing to store their funds such that they can manage their own private keys and thus have full control over their assets. 

Coinbase Falls Behind

Despite being the platform with the most Bitcoins since 2014, Coinbase’s luck started running out in 2021, when its holdings started dropping while Binance’s holdings rose sharply. Finally, on July 18, 2022, Binance overtook Coinbase, adding to the latter’s troubles. Coinbase has already been struggling in the bear market. It had to suspend its affiliate program, Coinbase Pro, and lay off employees. There have also been rumors of a possible bankruptcy declaration. The Coinbase NFT marketplace has also struggled to take off in the last couple of months of being fully live to the public. Furthermore, the company’s stocks have taken a stumble in the stock market recently. Experts do not believe that Coinbase can regain its throne as the largest store of BTC as other exchanges like FTX are also giving it tough competition. 

Binance Leading The Charge

On the other hand, Binance is flourishing despite the bear market. CEO Changpeng Zhao (CZ) has remained everpresent in the public’s conscience through repeated appearances and staying involved in the current discourse. The Binance Coin (BNB) has also managed to secure the position of the fifth largest crypto by market capitalization. It also appears to be unaffected by the Terra LUNA crash, as it has not imposed any transaction restrictions on its customer base. The platform is also not withdrawing from any of its commercial agreements like many other companies. In fact, it has gone the opposite route and multiplied its partnership deals. Following its five-year anniversary celebrations, Binance has also suspended transaction fees on Bitcoin from its platform. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.