Comment on page
Exchange Data: Transparency Notice
At Glassnode, we are committed to providing you with the most precise and up-to-date on-chain data for centralized exchanges. In our continuous effort to maintain transparency and trust, the present notice aims to help you understand how Glassnode tracks on-chain addresses necessary for an accurate representation of centralized exchange balances, and how to interpret the resulting exchange data.
Note: Within this context, "exchange metrics" strictly refers to on-chain metrics – those that monitor exchange balances and movements by identifying, labeling, and observing blockchain addresses and wallets owned by centralized exchanges. Metrics stemming from off-chain data directly from exchanges, such as futures or spot volume, are excluded from this definition.
Exchange balance data hinges on identifying network addresses or wallets linked to specific centralized exchanges. Therefore, the integrity of such data is contingent upon persistent, precise, and holistic labelling and monitoring of these addresses.
At Glassnode, our methodology in monitoring exchange addresses comprises:
- Verified addresses: Utilizing addresses officially reported and verified by exchanges, available either via public domains (e.g., Proof-of-Reserves disclosures) or through private correspondence with our team.
- External sources: Harnessing publicly accessible address tags, which undergo a rigorous quality assurance evaluation.
- Clustering algorithms: Implementing heuristics and (machine learning) clustering algorithms that continuously track and update the corresponding set of on-chain labels for every exchange.
Complete accuracy in regard to exchange data remains elusive, but the expertise we have built up over many years allows us to track labels and exchange patterns with a high degree of certainty. Its accuracy has been validated against exchange balances in the lead-up to their Proof-of-Reserve address disclosures.
While we strive to ensure the utmost accuracy in representing exchange balances, it is important to note that these figures might not always encapsulate the entirety of an exchange’s reserves. Particularly when exchanges refrain from disclosing their official addresses, as the precision of this data is – partially – influenced by an exchange's willingness to unveil their proof of reserves and provide clarity on wallet categorization. The following table helps evaluate the Proof-of-Reserve address provisions of supported exchanges, serving as an added assurance metric for exchange balance accuracy.
Discerning the implications and limitations of our exchange data is paramount:
- Reported exchange balances may not fully encapsulate the entire spectrum of digital assets maintained by an exchange.
- Such balances can partially hinge on addresses officially disclosed by exchanges. Where this prevails, the data's authenticity and accuracy can be deemed superior. The accompanying table below offers clarity on this aspect.
- Glassnode aims for optimizing to reduce the amount of false-positive addresses (i.e. addresses falsely categorized as belonging to an exchange). Therefore, reported exchange balances can largely be considered as lower bounds of the true balance.
- As of today, our data encompass exchange balances of assets inherently housed on Bitcoin and Ethereum exclusively, and limited to assets supported on our platform. We refrain from assertions concerning assets in other L1/L2 blockchains.
- Additionally, we do not present data or insights into other (non-digital) assets maintained by exchanges, nor do we incorporate information on their obligations and liabilities.
- Inherently, reported exchange balances may undergo retrospective revisions. Automatic or manual identification and addition of addresses associated with an exchange can recalibrate the balance. Noteworthy shifts in our exchange data and the resulting metric changes are always transparently communicated via our platform – in particular, be sure to always review our Changelog. We recommend leveraging our Point-in-Time metrics if you’d like to work with immutable data points.
- Preliminary data manifestations, such as a significant inflow or outflow, ought to be approached with caution. Exchanges can spontaneously modify their addresses and reshuffle funds internally. While our algorithms usually detect such shifts, occasional events are impossible to uncover immediately and mandate intervention and rectification by our data scientists.
- While tracking exchange balances is an imperfect process due to the ever-changing nature of wallet addresses, on-chain data from exchanges continues to be an indispensable and trustworthy reference for traders, researchers, and investors.
Legal Disclaimer: Exchange balances presented are derived from Glassnode’s comprehensive database of address labels, which are amassed through both officially published exchange information and proprietary clustering algorithms. While we strive to ensure the utmost accuracy in representing exchange balances, it is important to note that these figures might not always encapsulate the entirety of an exchange’s reserves, particularly when exchanges refrain from disclosing their official addresses. We urge users to exercise caution and discretion when utilizing these metrics. Glassnode shall not be held responsible for any discrepancies or potential inaccuracies.