Topic: Coinbase Holds a Whopping 966,230 Bitcoin ($7B) in Cold Wallet (Read 277 times)

Loads of people keep their assets on Coinbase. It's because the bitcoin blockchain is now so large, people who just access the net via their phones prefer to use an online wallet, rather than set up their own wallet on a dedicated laptop.

I just hope Coinbase have good security installed.

The problem with not including suspected coins that are lost or locked forever is we don't know for sure if they are. We know a certain amount is lost forever due to certain qualities or it was sent to burn addresses or something like that, and that's only less than a few thousand provably lost.

The rest are still unknown and will remain unknown. Coins that haven't moved in 5 to 7 years can still be owned by the same people and still have access to them, merely not just moving them or spending them.

They hold 1.25% of the total coins mined till now, including the coins that have never been moved like the ones attributed to satoshi.
I was trying to suggest that the percentage is a bit higher if we cut the numbers down to 16-15 mils coins that are not lost or locked forever.
On the other hand volume clearly is done with coins that can be moved (or fake bots)  

LE, to combine replies:


Yeah but this is the part of the math I was talking.

They have 0.1% of the volume, that volume is made with coins that we suppose been moved in the last 12 months.
On the other hand, they have 1.25% of the total coins including the ones that might be lost forever.
So if after 12th December when the next numbers are published and we find out that all the exchange held about 50% percent of all the coins even mined, the number will grow in Bitstamp's favor.
They would still be doing 0.1% of the volume but (in this scenario) they would hold 2.5% of all the coins held by exchanges!

Anyhow I assume there will be some long faces when exchanges claiming billions in trade would be uncovered with 200 BTC in cold wallets.

What do you mean by "including satoshi's?"


I suspect that a huge number of people use Coinbase as wallet -- same as Mt. Gox back in the day. I assume the numbers here include Coinbase Pro since their wallets are associated.

The source is bituniverse
Linking the image as it's a weird format size.

What I can't wait for is the release of data for other exchanges, they say they will publish the data on the 12th.
I'm sure we're going to have a lot of surprises.
Bitstamp is doing less than 0.1% of the global volume but is holding 1.25% of the total number of bitcoins (including satoshi's)
Also bitmex is holding 10% more than bitstamp but is doing 40x times the volume.

Grabbing some popcorn!!!

It's likely that many users just leave a small amount on Coinbase, including both BTC and fiat, so they can do some trading. Coinbase isn't really a bid/ask type of exchange though, unless this number also includes Coinbase Pro, which is the real exchange.

It doesnt matter safe or not, it should NOT happen, ever.
Its too much BTC in one place, it should be decentralized.
Worst case here is that its people bitcoins that they just don'y withdraw and they SHOULD.
Imagine someone would hack 966000 bitcoins now... it would CRASH price and trust in bitcoin for looong time.

I'm not too worried about Coinbase getting hacked. They don't seem to have been hacked as far as we know and they only keep 2% of their holdings in hot wallets for people to withdraw conveniently.

2% of nearly 1 million is still a lot, but I'm pretty sure that Coinbase has enough security measures in place to block suspicious withdrawals, especially when they are unusually large.... something other exchanges can learn from.

Similar thread here: https://bitcointalksearch.org/topic/coinbase-holds-a-whopping-966230-bitcoin-7b-in-cold-wallet-5206249

Although this seems to be more appropriate in Bitcoin Discussion. It's true that risks can be found in such a way of handling funds. If the wallet holder decides to get it all though, it would be a lot of risk to him/her since his/her identity is known already, unless the private keys are "stolen" (as they might say), in which case solid evidence must prove the theft. And it would be hard for the thief to get it in cash/fiat because the address used to steal such amount would be closely monitored for transactions, as the blockchain is transparent.

And with this news, maybe Coinbase will also be the prime target for hackers, because it just attract those cyber criminals to step up their game.


Not your keys, not your coins, simply as that. If you understand that then you won't leave huge funds in Coinbase or at least any exchange for that matter.

Mostly other people storing their assets, but a bit of their own profits as well.

Coinbase state that they have 30 million users. 966,230 BTC works out as only 0.032 BTC per user. Not that hard to believe, especially when you consider there are several users trading hundreds or even thousands of bitcoin on Coinbase. Additionally, with Coinbase taking anywhere between 0.05% and 0.5% from both makers and takers, that works out as 0.1% to 1% of profit on a daily volume of over $55 million for BTC markets alone, giving them a profit of probably somewhere around 50 BTC every day just in trading fees from BTC markets.

There isn't enough liquidity to dump 1 million BTC on the market at once. Anyone who is smart enough to be able to hack Coinbase's cold wallets is smart enough to realize that, and would likely just trickle the funds in slowly. The converse to that is that as soon as news broke that 1 million BTC had been hacked, loads of people would panic sell and the market would dump anyway.

$7B worth of bitcoins is just too much for any exchange to hold. It's risky for them as well as their customers. These days, exchanges are getting hacked like it's a piece of cake for the hackers.
What if these funds are stolen by a hacker or the exchange scams it's customers just like Mt. Gox.
I just hope that their customers don't hold more amount of crypto in Coinbase. It's risky for them to hold crypto in Coinbase when knowing the numbers are public now and the exchange is more prone to getting hacked.

How did they get that number in the first place? Is it from transaction fees or there are a lot of people who keep their assets on Coinbase? It's hard to believe for me.

Well, hopefully, it won't get hacked. The market will suffer like hell if all of those get dumped.

Coinbase Dominates The Market
Coinbase is recognized for being one of the crypto exchanges with a very user-friendly interface and large liquidity.

This time, the exchange shows it holds 4.6% of the total Bitcoin supply that could ever be mined.

The funds the company holds in its cryptocurrency cold wallet are the reserves that the exchange has in case users want to withdraw their funds.

It is worth mentioning that not all this amount of money is owned by Coinbase. These funds are the ones that the exchange holds on behalf of the users that are trading on the platform.

Coinbase provides custody to users. Individuals are not able to hold their private keys while using the Coinbase platform.

The funds Coinbase is currently handling are equal to $7.91 billion.

The data provided by BitUniverse shows that Coinbase is ahead of other competitors. Indeed, the next top 5 exchanges would have to combine all their funds if they want to hold more BTC than Coinbase.

BitMex is the second exchange with the largest number of BTC held. They have 265,140 BTC, worth $1.97 billion.

Other exchanges include Bitstamp with 229,490 BTC, Bitfinex with 146,120 BTC and Kraken with 136,780 BTC. These funds are valued at $1.71 billion, $1.54 billion and $1.4 billion.

Several exchanges have been accused of having fake volumes. This allows companies to attract a larger number of users considering many would prefer to trade in a platform with large liquidity.

Despite having the largest funds held in cold storage, Coinbase didn’t register the largest trading volume in 24 hours.

BitMex handled $2.49 billion on the first day of December, followed by Coinbase with $118.65 million and Kraken with $86.37 million.

BitMex provides users with the possibility to trade with leverage up to 100x. Coinbase is known as the user-friendly exchange, while the other platforms have different features and solutions to distinguish themselves from competitors.

Exchanges must be very careful with how they handle their funds considering hackers could be targetting these platforms and try stealing some funds.

Coinbase is also known for having very secure security solutions that were never publicly vulnerated by an attacker. Other platforms were hacked in the past and many of them had to stop operating.

 Read more at: https://coinspace.com/news/exchanges/coinbase-holds-over-966-million-bitcoin-its-cold-wallets

You don't need a decent computer. You can run a fully air gapped cold wallet on any old desktop or laptop you have lying about. You can do it on a raspberry pi for 30 bucks. You can buy a Ledger or a Trezor hardware wallet for 50 bucks. Even something like the Electrum mobile app is better than trusting an exchange. All this talk about needing good computers which have enough memory to download the entire blockchain is nonsense.

I think that people who are serious about Bitcoin storing can afford a decent computer to install a truly secure wallet.

The size of the blockchain is not that relevant to storing your coins securely. You can set up your own wallet by downloading, verifying and running a simple wallet such as Electrum, which has a size of 10 - 50MB depending on the version you install. Better than that, you can use a hardware wallet which also requires minimal downloading/memory, or a paper wallet which potentially requires none at all. All of these options are miles ahead of using a web wallet or exchange wallet.

You only need to download the blockchain if you want to run a full node, which although does add security in that you do not have to trust any third parties to verify transactions, does not add any security in terms of keeping your private keys safe.

It is but so was MtGox. Exchanges have a tendency to grow and gain trust with each year but then it all goes down the drain when they get hacked or somebody leaks information. I don't like Coinbase because of their full cooperation with all agencies and KYC requirements. Who knows where their KYC information will end up one day.
The money can be quite safe there but even they don't have an insurance fund that would be able to cover even $1B.

People are stupid. They've been told over and over about the dangers of trusting a third party with their coins. They have the example of Mt gox, mintpal, upbit and numerous other hacks and losses.

And still they keep their coins online because they're too lazy to set up their own wallets. (Though I concede that the size of the blockchain is now a problem if you haven't got a lot of memory in your computer).

It's not surprising to know that there are huge number of people who trust coinbase. Coinbase is a really well established wallet service for bitcoin and also a way to exchange bitcoins to fiat instantly so its just normal for them to have this huge amount of bitcoin. I think blockchain wallet also holds tons of bitcoin because they are the 2 big names in this kind of industry.