In the world of cryptocurrency exchanges, it is sometimes difficult to gauge exactly how well each exchange is performing, given the fact that many use unscrupulous methods to artificially inflate their volume.
However, although it is a relatively simple process to inflate trade volume to climb the rankings, it is not possible to fake the amount of Bitcoin (BTC) heading to and from exchange wallets.
In light of this, TokenAnalyst, an on-chain intelligence platform that produces market insights and analytics on almost 30 cryptocurrencies has just mapped the flow of cryptocurrency between prominent exchanges.
Huobi-Binance Bitcoin Flow
Looking at the graph below, we can see that Binance has been the largest beneficiary of BTC transfers between exchanges in 2019. Of the eight exchange platforms analyzed by TokenAnalyst, Binance received the most BTC from other exchanges by far, taking in a total of 544,675 BTC (worth almost $5 billion) from other platforms so far this year.
Out of this half-million BTC transferred to Binance from other platforms, a disproportionately high amount originated from the Singapore-based exchange Huobi, which is widely considered to be Binance’s largest competitor. In total, 259,722 BTC were transferred from Huobi to Binance, equivalent to almost half of all BTC heading to Binance from the other tracked exchanges.
This 259,722 transferred from Huobi to Binance represents more than that transferred to Bitstamp, Bittrex, Bitfinex, BitMEX, Kraken, and Poloniex combined. The next largest source of BTC transferred to Binance this year was from Bittrex. 63,405 BTC were sent to Binance from Bittrex this year, again equal to more than half of all BTC sent from Bittrex to other exchange platforms.
Conversely, just over a quarter of BTC sent from Binance to other exchanges was destined for Huobi (136,638 BTC out of a total of 539,118 BTC). Similarly, just 43,883 BTC was sent to Bittrex from Binance, which is less than a tenth of its total outgoing BTC.
Reacting to the report, Binance CEO Changpeng Zhao took the opportunity to gloat about the success of the exchange platform, tweeting ‘Come to papa,’ while remarking that ‘China is active’ — likely in reference to Chinese President Xi Jinping’s pledge to ramp up efforts in the blockchain development sector.
Come to papa.
China is active. https://t.co/sBExNS52c0
— CZ Binance (@cz_binance) November 8, 2019
No Single Winner
Although it is clear that Binance is easily the biggest beneficiary by looking at the chart, what is not so obvious is the fact that Binance sends more than double the amount of BTC to Bitstamp than it receives. Similarly, Binance sends almost 68,000 BTC to Bitfinex, despite receiving just 57,829 BTC to the same platform.
Binance also sends more BTC than it receives to BitMEX and Poloniex, which indicates that these platforms are more desirable among BTC holders, potentially due to their reputation as popular margin trading platforms. Now that Binance offers margin trading, it remains to be seen whether these platforms will suffer as a consequence.
Likewise, when comparing the total ingoing and outgoing BTC for each platform, we find that BitMEX, Kraken, Poloniex, and Bitstamp receive more BTC than they send to other platforms. On the other hand, Binance, Poloniex, and Huobi receive less BTC than they send, with Huobi in particular leaking Bitcoin almost twice as fast as it’s received.
Images courtesy of Shutterstock, TokenAnalyst, Twitter.
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