Over 15% of Crypto.com’s token reserves come from Memecoins

According to blockchain analytics firm Nansen, Crypto.com has a total on-chain portfolio of around $6 billion, with memecoins including SHIB, PEPE, FLOKI, LADYS, and MOG making up more than 15% of the exchange’s token reserves allocated to customers.

Amidst the meme coin frenzy, where the whims of these types of cryptocurrencies sometimes dominate market sentiment, one exchange stands out because of the large share of its token reserves coming from meme coins.

Singapore-based exchange Crypto.com held more than $920 million worth of memecoins for its clients as of Monday, representing more than 15% of the exchange’s entire token reserves, according to data from blockchain analytics firm Nansen.

Of the Crypto.com on-chain wallet, which is worth nearly $6 billion, 12% or $718 million comes from the dog-inspired memecoin SHIB, 2% or $124 million stems from the frog-based memecoin PEPE, while 1% or $82 million is made up of various other coins such as FLOKI, LADYS, and MOG.

After BTC and ETH, the two largest cryptocurrencies by market cap, Crypto.com holds more SHIB in dollars than any other token, with PEPE as the exchange’s fifth-largest holding, according to Nansen. In November 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 Makes Many Reminisce About Ethereum’s 2017 ICO Craze

“All client assets on our platform are fully backed (1:1), securely stored and available for redemption,” Crypto.com’s webpage asserts. Representatives for Crypto.com did not immediately respond to Unchained’s request for comment.

According to @Ponyongmi, who has been trading cryptocurrencies since 2020, Crypto.com’s share of memecoin holdings is “quite astonishing.” “It shows that they are betting heavily on these high-risk, high-reward tokens, reflecting the attitude many young people in the industry have toward investing.”

“Crypto.com is a pioneer in the meme space, and they generally list meme coins much earlier than other exchanges,” MOG accelerator @Virotechnics wrote to Unchained via Telegram. “The retail sector continues to favor meme trading over most other sectors this cycle, and listing these projects early is a risk they are taking but ultimately can be very rewarding for both them and their users.”

Binance vs Gemini Comparison

By comparison, Binance, which has a token reserve of $102.9 billion, does not have any memecoin in its top 10 holdings. However, PEPE and SHIB come in at 11th and 12th place respectively, accounting for roughly $2.15 billion or 2.08% of all cryptocurrencies on Binance.

While Crypto.com has a higher percentage of memecoins relative to its total reserves, Binance holds more memecoins in absolute dollar terms. Binance also holds $521 million worth of PEOPLE, BONK, and FLOKI.

Read more: 80% of tokens on Binance have fallen since listing date

Compared to Crypto.com and Binance, rival exchange Gemini, which is regulated in the United States, not only holds fewer memecoins, but also has a smaller share of memecoins in relation to its total reserves.

PEPE and SHIB are the fifth and sixth most liquid cryptocurrencies on Gemini, respectively making up 1.1% of the exchange’s total holdings, which are worth a combined total of around $70.6 million.

“I think we will peak when casinos start integrating memecoin trading into their halls and when large memecoin-backed loans start to liquidate. Given the current trend, another centralized exchange collapse due to excessive risk-taking wouldn’t surprise me,” added @Ponyongmi.

Users on Crypto.com can trade on margin with up to 10x leverage on over 200 pairs. DOGE and SHIB are eligible collateral for those who want to trade on margin, according to Stock Exchange website.

Correction (July 8, 2024, 7:12 p.m. ET) Corrected misspelling of the word “FLOKI”.