[Exclusive Research] New Crypto Exchange Ranks (CER) Report Analyzes Banks vs Bitcoin Exchanges
CER Releases Ground-breaking Report Comparing Crypto Exchanges With Traditional Banks
Cryptocurrency exchanges play a crucial role in the digital economy. They’re designed to be the banks of the future. But do cryptocurrency exchanges really have what it takes to replace traditional banks?
Our friends at Crypto Exchange Ranks (CER) recently decided to answer that question. In a report titled, “Traditional Banks Versus Crypto Exchanges – Banks of the Future”, CER examines today’s top cryptocurrency exchanges to determine if they can really create the banking system of the future.
CER is a cryptocurrency exchange ranking and security service designed to help crypto users choose the best exchange. Found online at CER.live, Crypto Exchange Ranks analyzes exchanges based on their liquidity, cybersecurity, certification, and solvency, among other ranking factors. The service is powered by Hacken (Hacken.io).
Traditional Banks Versus Cryptocurrency Exchanges
So how do cryptocurrency exchanges stack up against modern financial institutions?
To answer that question, CER analyzed the following:
- The five largest banks from the United States and the United Kingdom
- Five local banks from emerging countries
- Five largest cryptocurrency exchanges by wallet balance.
The largest banks from the UK and US included JP Morgan Chase, Bank of America, HSBC, Wells Fargo, and Citigroup. The five banks from emerging economies included banks in Morocco, Thailand, Lebanon, Pakistan, and Ukraine. The five crypto exchanges included Coinbase, Kraken, Huobi, Bitfinex, and Binance.
CER analyzed the balance sheets from each of these financial institutions, including the total amount of funds deposited into each bank or exchange.
Understandably, the five largest UK and US banks dominated the show, with deposits hundreds of times larger than the banks in emerging markets, and thousands of times larger than the largest cryptocurrency exchanges. That should surprise nobody.
What is interesting, however, is that global crypto trading platforms fall significantly behind banks even in emerging economies. The bank in Morocco, for example, had more than 15x the deposits as the largest cryptocurrency exchange, Coinbase, for example.
“If we omit the top-5 [US and UK] banks from the comparison, we still can see that global trading platforms fall behind by customer deposits even compared to local banks from emerging countries,” explained CER in its report.
“The top-5 trading platforms’ wallet balances lag behind the deposits in local banks by 15 times on average. The gap between trading platforms and top-5 banks by this indicator is more remarkable – over 1,000 times.”
Based on this information, CER believes that cryptocurrency exchanges have a long way to go before they can be perceived as the banks of the future. In order to create the banking system of the future, these crypto exchanges first need to be trusted by customers willing to deposit hundreds of millions’ of dollars into exchange wallets:
“It implies the long way for crypto exchanges to go in order to attain a truly global scale, which will be measured not by virtual numbers of trading volumes but by real customer funds, trusted to exchanges.”
The top five cryptocurrency exchanges by stored funds, by the way, are Coinbase, Binance, Huobi, Bitfinex, and Kraken, in that order.
How CER Ranks Crypto Exchanges
At the official CER.live website, Crypto Exchange Ranks measures cryptocurrency exchanges based on a number of different factors, including:
- Wallet Balances
- Reported Volume (24 Hours)
- Adjusted Volume (24 Hours)
- Activity Index
- General Rating
Other sites will list cryptocurrency exchanges by trading volume. Few websites, however, report the wallet balances of major exchanges. Crypto Exchange Ranks may be the first site that has gathered this information into one place.
It also appears that CER will calculate its own trading volume instead of just blindly trusting the reported trading volume from each exchange.
Meanwhile, all exchanges currently listed on CER.live are listed as “Not Certified”. That means Binance, which has a less-than-transparent organizational structure and is based in crypto-friendly Malta, has the same certification status as Coinbase, a San Francisco-based licensed and regulated corporation.
Based on CER’s initial crypto exchange ratings, Binance is the highest-rated exchange in the crypto space today with a rating of 6.94. Other top-ranked exchanges include Bittrex (6.10), Coinbase (6.05), Bitfinex (6.00), and Coinone (5.85).
So far, 100 exchanges have been featured on the CER.live website, allowing crypto exchange users to get at-a-glance information on the best crypto exchanges worldwide.
Can Cryptocurrency Exchanges Really Become the Banks of the Future?
Part of the goal with CER’s report was to determine if cryptocurrency exchanges can really become the banks of the future. Can today’s crypto exchanges really pave the way for a future digital economy? Or will traditional banks continue their dominant hold over the marketplace?
The full report comparing cryptocurrency exchanges with conventional banks can be found online at CER.live.