London, 13th July 2020 - CryptoCompare, the global leader in digital asset data, today announced an update to its cryptocurrency Exchange Benchmark, revealing a new ranking of exchanges based on several criteria including counterparty, operational, trading and security risk. The Benchmark ranks more than 165 global spot exchanges to bring transparency and accountability to the cryptoasset exchange landscape by providing a framework for assessing risk. The Benchmark assigns a AA - F grade to help identify the lowest risk venues in the industry.
The analysis reveals that US exchanges retain the top spots, with Gemini ranked first. Gemini is followed by Coinbase (2), Kraken (3), itBit (4) and Bitstamp (5).
- Lower-Tier exchanges (grades C-E) have continued to lose market share to Top-Tier exchanges (grades AA-B), quarter on quarter. Top-Tier exchanges (grades AA-B) accounted for 32% of global volumes in Q4 2019. In 2020, they accounted for 36% in Q1 and 40% in Q2.
- The top three decentralised exchanges (DEXs) based on our refined DEX methodology are Binance DEX, Switcheo, and IDEX.
- 38% of exchanges were found to interact with high risk entities for more than 25% of transactions, according to CipherTrace’s Interaction Risk data.
- 4% of exchanges have been hacked in the last year.
- Only 15% of exchanges state that they hold more than 95% of crypto in cold wallets.
Tyler Winklevoss, CEO of Gemini said: "Gemini provides retail and institutional investors with a simple, elegant, and safe way to buy, sell and store cryptocurrency. From the beginning, we have created high-integrity products that revolve around compliance, regulation and security. We are excited to be independently recognized as the top exchange for delivering a trusted experience to customers.”
Charles Hayter, Co-Founder and CEO of CryptoCompare, commented: “As the digital asset industry evolves and expands, the need for reliable metrics to evaluate the growing list of cryptocurrency exchanges is paramount. Our Exchange Benchmark aims to provide this transparency by evaluating exchanges using a clear methodology to assess risk. Our updated Benchmark builds upon our trusted methodology to better inform decision-making for market participants.”
“Accurate and insightful rankings are a key data set for investors in any healthy market and we are pleased to support the CryptoCompare Exchange Benchmark with the FCAS Rating System. We encourage any initiative that fosters transparency and helps investors navigate the digital asset markets”, said Dave Balter, CEO at Flipside Crypto.
CryptoCompare launched the Exchange Benchmark in June 2019 to evaluate global cryptocurrency exchanges. Initially ranking over 100 exchanges, it now includes analysis of more than 165 crypto exchanges globally. It employs a qualitative (due diligence) and quantitative (market quality, based on order book and trade data) approach and uses correlation of volume to volatility and standard deviation of volume as inputs to the analysis. The Exchange Benchmark does not rely on aggregate volume data in its analysis due to concerns over volume manipulation, wash trading and trading incentives.
The ranking components include: legal/regulatory; data provision; security; team/exchange; market quality; KYC/transaction risk; asset quality/diversity and a penalty factor for negative events. Analysis is based on public information and detailed methodology is made freely available, underscoring CryptoCompare’s commitment to bringing greater transparency and improved decision-making to the cryptocurrency marketplace.
CryptoCompare is the global leader in digital asset data. Institutional and retail investors rely on the company for real-time, high quality data spanning 3,200+ coins and 150,000+ currency pairs. By aggregating and analysing tick data from globally recognised exchanges and seamlessly integrating multiple datasets, CryptoCompare provides a comprehensive, granular overview of the market across trade, order book, historical, social and blockchain data. For more information, please visit https://data.cryptocompare.com