<p>While choosing a bitcoin exchange, look for an information about where do they keep funds. If they say that they 100% of funds of customers is being stored in cold wallets, it means that they actually hold enough bitcoins to cover all transactions.  </p>

CC BY-SA 3.0
2015-01-26T13:17:27.743Z
2015-01-26T15:26:20.150Z
2015-01-26T15:26:20.150Z
Tood_BTC
<p>Traditional Bitcoin exchanges hold their customers' funds, both Bitcoins and counter-currencies. So when a trade is actually made, the exchange just adjusts their own balance numbers. Prior to being able to buy Bitcoins, you must deposit some other currency into your account at the exchange. Prior to being able to sell Bitcoins, you must deposit Bitcoins into your account at the exchange.</p>

CC BY-SA 3.0
2015-01-22T10:55:49.423Z
What if someone tried to buy a larger amount of bitcoins than is the sum of the offered bitcoins by the user of that exchange?
Alexander Popov
CC BY-SA 3.0
2015-01-22T20:00:36.047Z
@AlexPopov That offer would stay on the books until people satisfy it.
David Schwartz
CC BY-SA 3.0
2013-12-18T22:54:31.470Z
2013-12-18T22:54:31.470Z
David Schwartz
<p>If I have a balance in USD with any exchange, and I placed an order to buy bitcoins, how does it work for the exchange? do they need to hold enough bitcoins to cover all the "buy" transactions and sell those bitcoins to me from their wallet? or, they will find someone on their platform who wants to sell that amount at that price and withdraw his bitcoins to my bitcoins?</p>

<exchanges>
Do bitcoin exchanges own the bitcoins they trade with?
user10950
# Do bitcoin exchanges own the bitcoins they trade with?

(Asked by: username_0 on 2013-12-18)

If I have a balance in USD with any exchange, and I placed an order to buy bitcoins, how does it work for the exchange? do they need to hold enough bitcoins to cover all the "buy" transactions and sell those bitcoins to me from their wallet? or, they will find someone on their platform who wants to sell that amount at that price and withdraw his bitcoins to my bitcoins?

**Tags:** exchanges


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## 2 answers

### Answer by username_2 on 2013-12-18. Score: 8 | Accepted answer

Traditional Bitcoin exchanges hold their customers' funds, both Bitcoins and counter-currencies. So when a trade is actually made, the exchange just adjusts their own balance numbers. Prior to being able to buy Bitcoins, you must deposit some other currency into your account at the exchange. Prior to being able to sell Bitcoins, you must deposit Bitcoins into your account at the exchange.

> **Comments:**
> **username_3**: What if someone tried to buy a larger amount of bitcoins than is the sum of the offered bitcoins by the user of that exchange?  
> **username_2**: @AlexPopov That offer would stay on the books until people satisfy it.  

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### Answer by username_1 on 2015-01-26. Score: 0

While choosing a bitcoin exchange, look for an information about where do they keep funds. If they say that they 100% of funds of customers is being stored in cold wallets, it means that they actually hold enough bitcoins to cover all transactions.


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