Why Exchange Wallets Top Token Holder Lists (and How Much They Distort It)
6 min read· Updated 24 October 2026
Open the holder list of a widely traded token and the top entries are often labelled with exchange names: hot wallets, cold wallets, deposit addresses. Those addresses hold coins that belong to thousands of the exchange's customers. Counting them as if each were one investor makes a token look far more concentrated than it is.
What these wallets are
- Cold wallets hold the bulk of an exchange's customer funds offline. They are usually the single largest exchange address on a token.
- Hot wallets hold a working balance for withdrawals.
- Deposit addresses are created per customer and swept into the hot or cold wallets.
An exchange can spread a token across dozens of addresses, and it reshuffles them over time. A holder list can therefore show "OKX 153", "OKX 193" and "OKX 226" as three separate entries in the top 10.
How big the distortion is
We measure it every day. Across the 405 Ethereum and Optimism tokens in our most recent readings (as of 24 October 2026):
- 352 of 405 had at least one exchange, bridge, treasury, pool, staking or burn address in their plain top 10.
- The median difference between the plain top-10 share and the share held by the ten largest private wallets was 16.9 percentage points.
- For 188 tokens the difference was more than 20 points.
- Exchange wallets were the largest single group of excluded addresses, about 57% of all the top-10 addresses we set aside.
How to recognise an exchange wallet yourself
- Explorer labels. Etherscan, Blockscout and others tag well-known exchange addresses with a name, and often a generic "Exchange" tag.
- Behaviour. Exchange wallets have very many transactions with many different counterparties, every day, in many tokens.
- Many tokens. An exchange cold wallet holds hundreds of different tokens; a private investor rarely does.
Labels are not complete. Smaller exchanges, newly rotated wallets and custodians are often unlabelled, which means even a corrected figure can still contain some exchange holdings. When an unlabelled address holds a large share, it is worth looking at its activity before drawing conclusions.
Exchange holdings are still a risk of a different kind
Coins on an exchange belong to many customers, so they are not one party able to move the price. But they are coins that can be sold quickly, and a token whose supply sits mostly on one exchange depends on that exchange. That is a liquidity and custody question rather than a concentration question.
How FraudCoins handles it
Our top-10 figure excludes addresses identified as exchange, market-maker, bridge, treasury or vesting, pool, staking and burn wallets, and every coin page names the addresses we set aside and why. The largest corrections are listed on the corrections page, and the rules are on the methodology page. For background on the metric itself, see holder concentration.