According to blockchain analytics firm Nansen, Crypto.com’s onchain portfolio totals nearly $6 billion, with memecoins such as SHIB, PEPE, FLOKI, LADYS, and MOG constituting more than 15% of the exchange’s token reserves held for customers.
Crypto.com’s Substantial Memecoin Holdings
As of Monday, Crypto.com holds over $920 million worth of memecoins for its customers, representing a significant portion of the exchange’s reserves. Of Crypto.com’s nearly $6 billion token reserves, 12% ($718 million) comes from SHIB, 2% ($124 million) from PEPE, and 1% ($82 million) from other memecoins like FLOKI, LADYS, and MOG.
After BTC and ETH, Crypto.com holds more SHIB in dollar terms than any other token, with PEPE as the exchange’s fifth-largest holding. In November 2020, Crypto.com had nearly $3 billion in reserves, of which about 20% ($558 million) came from SHIB. The exchange’s memecoin reserves highlight its aggressive approach towards high-risk, high-reward tokens, mirroring the investment attitudes of many young crypto enthusiasts.
Market Sentiment and Memecoin Frenzy
The prevalence of memecoins in Crypto.com’s reserves underscores the current market sentiment dominated by these types of cryptocurrencies. “Crypto.com is meme-forward, and they list memecoins generally a lot earlier on than other exchanges,” said MOG accelerationist @Virotechnics. He noted that retail investors continue to prefer trading memecoins, and listing these projects early can be very rewarding for the exchange and its users.
Crypto.com vs. Binance and Gemini
In comparison, Binance, with a token reserve valued at $102.9 billion, does not have a memecoin in its top 10 holdings. However, PEPE and SHIB are the eleventh and twelfth largest holdings, representing nearly $2.15 billion or 2.08% of all cryptocurrencies on Binance. Binance also holds $521 million worth of other memecoins like PEOPLE, BONK, and FLOKI.
While Crypto.com has a higher proportion of memecoins relative to its entire reserves, Binance holds more memecoin value in absolute dollar terms. This distinction highlights the different strategies employed by the two exchanges in managing their token reserves.
Insights from Industry Experts
The significant share of memecoins in Crypto.com’s reserves has drawn attention from industry experts. “Crypto.com’s share of memecoin holdings is quite eye-opening,” said @Ponyongmi, a crypto trader since 2020. He noted that the exchange’s strategy reflects the high-risk, high-reward mindset prevalent among many young investors in the crypto space.
Vivien Lin, BingX’s Chief Product Officer, highlighted the importance of secure and transparent trading environments in the current market cycle. She emphasized that initiatives like early listing of memecoins can foster innovation while ensuring user protection.
Future Implications and Risks
The increasing popularity of memecoins raises questions about their long-term sustainability and potential risks. @Ponyongmi suggested that the market could hit a peak when traditional financial institutions, like casinos, start integrating memecoin trading on their floors. He also warned of the potential for centralized exchanges to collapse due to excessive risk-taking associated with memecoins.
Crypto.com offers margin trading with up to 10x leverage for over 200 pairs, with DOGE and SHIB eligible as collateral. This high-leverage trading option adds another layer of risk for users engaging in memecoin trading.
Crypto.com’s substantial holdings in memecoins underscore the exchange’s aggressive strategy in the high-risk, high-reward crypto market. While this approach aligns with current market sentiment, it also poses potential risks. As the market continues to evolve, the impact of memecoins on exchanges like Crypto.com will be closely monitored by industry experts and investors alike.
