On December 2nd, the Reddit user webb32503 posted a screenshot from a research by the blockchain security firm PeckShield and the software company BitUniverse on a Bitcoin subreddit of Bitcoin(BTC)trade holdings that various crypto exchanges possess.
At the top of the list is Coinbase with a total of 966,230 BTC, which is worth over $7 billion in the current Bitcoin price. The leading crypto exchange based in the United States is significantly ahead of other cryptocurrency exchanges in terms of Bitcoin holdings.
The second place for the higher number of Bitcoins under crypto exchange is held by BitMEX, with almost 265,000 BTC (nearly $2 billion), significantly lower than Coinbase in the first place;; and the third place goes to Bitstamp not very far from BitMEX with 229,000 BTC ($1.7 billion).
Since its launch in 2012, Coinbase has accumulated large amount of BTC over the years, as the current price of a single Bitcoin is at around $7,300. This means that Coinbase’s total 966,230 Bitcoins when exchanged into US dollar will add up to almost 7.19 Billion.
BitMEX’s 265,000 Bitcoins stored when converted based on the current price of Bitcoin as well would amount to almost $2 billion; and if Bitstamp, holding the third respectable place, converts its 229,000 Bitcoins, it would receive $1.7 Billion. However, along with Bitcoin, Bitstamp also holds Ethereum (ETH)trade, approximately 27,000 ETH (over $4 million), and 861.83 Tether (USDT).
One Reddit user commented on the post, stating that while the crypto exchanges have the private keys to these digital coins, their job is to act more like banks than Bitcoin holders. The user added that in this case most of the crypto coins represented in the analytics are deposits made by their respective costumers and not owned by the actual virtual asset exchanges themselves.
Another user commented, asking for the clarification between whether the analytics showed ownership of the Bitcoin or simply their custody, to which the original Reddit user who posted the screenshot (webb32503) replied that the numbers represent the number of Bitcoins these crypto exchanges keep in their cold wallets.
Many users from the Bitcoin subreddit were quick to point out that if the entity does not hold the keys, they have therefore no claim over the digital coins.
This is typically reinforced with the idea that if you control the keys, you own the Bitcoin. Although, you can twist around the terminologies and toy with the semantics but the nature of blockchain technology makes the ownership binary. Hence, either you are the owner of the private key and therefore own the Bitcoin funds, or you don’t own the key and own nothing.