In the midst of a memecoin frenzy, with market sentiment sometimes dominated by the whims of these types of cryptocurrencies, one exchange stands out for the large share of its token reserves coming from memecoins.
Singapore-based exchange Crypto.com holds over $920 million worth of memecoins for its customers as of Monday, representing more than 15% of the exchange’s entire token reserves, according to data from blockchain analytics firm Nansen.
Of Crypto.com’s onchain portfolio, which stands at nearly $6 billion, 12% or $718 million comes from dog-inspired memecoin SHIB, 2% or $124 million stems from frog-based memecoin PEPE, while 1% or $82 million is composed of several others such as FLOKI, LADYS, and MOG.
After BTC and ETH, the two largest cryptocurrencies by market cap, Crypto.com holds more SHIB in dollar terms than any other token, with PEPE as the fifth-largest holding for the exchange, per Nansen. In Nov. 2020, Crypto.com had nearly $3 billion in reserves, of which about 20% or $558 million came from SHIB.
Read More: Solana’s Memecoin Boom Has Many Recalling Ethereum’s 2017 ICO Mania
“All customer assets held on our platform are fully backed (1:1), safely stored and available for redemption,” states the webpage for Crypto.com. Representatives of Crypto.com did not immediately respond to Unchained’s request for comments.
Crypto.com’s share of memecoin holdings is “quite eye-opening,” according to @Ponyongmi, who has been trading crypto since 2020. “It shows they’re betting aggressively on these high-risk, high-reward tokens, mirroring the attitude many young people in the industry have towards investing.”
“Crypto.com is meme-forward, and they list memecoins generally a lot earlier on than other exchanges,” wrote MOG accelerationist @Virotechnics to Unchained over Telegram. “Retail continues to prefer trading memes over most other sectors this cycle, and listing these projects early on is a risk that they take but ultimately something that can be very rewarding for them and their users alike.”
Binance and Gemini Comparisons
In comparison, Binance, which has a token reserve valued at $102.9 billion, does not have a memecoin in its top 10 holdings. However, PEPE and SHIB do come in at the eleventh and twelfth position, respectively, representing nearly $2.15 billion or 2.08% of all cryptocurrencies on Binance.
While Crypto.com has a higher proportion of memecoins relative to its entire reserves, Binance is holding more memecoin value in absolute dollar terms. Binance also holds $521 million worth of PEOPLE, BONK, and FLOKI.
Read More: 80% of Tokens on Binance Are Down Since Listing Date
Compared to Crypto.com and Binance, rival US-regulated exchange Gemini not only holds less memecoins, but also has a smaller share of memecoins in relation to its total reserves.
PEPE and SHIB are fifth and sixth most liquid cryptocurrencies on Gemini, respectively making up 1.1% of the exchange’s total holdings, which total roughly $70.6 million.
“I believe we’ll hit a peak when casinos start integrating memecoin trading on their floors and when large loans backed by memecoins start getting liquidated. Given the current trend, another centralized exchange collapsing due to excessive risk-taking wouldn’t surprise me,” added @Ponyongmi.
Users on Crypto.com can margin trade with at most 10x leverage for over 200 pairs. DOGE and SHIB are eligible collateral for those who want to margin trade, according to the exchange’s website.
CORRECTION (July 8, 2024 7:12 p.m. ET) Corrects misspellings of “FLOKI.”
