June 16, 2024

Increase in the share of institutional investors in the cryptocurrency market

Increase in the share of institutional investors in the cryptocurrency market

Bloomberg this week published data from a study by Crypto Fund Research, which stated thatAlmost 70 cryptocurrencies closed in 2019hedge funds focused on institutional investors. According to analysts, the strong volatility of Bitcoin and other cryptocurrencies still scares away institutional investors.

“The market is definitely targeted at retail traders and will remain so for the foreseeable future.”“Said Nick Carter, co-founder of Coin Metrics.

Analysts at Skew disagreed.position in brought a number of arguments that indicate the opposite. They noticed that LMAX Digital, the cryptocurrency platform of institutional forex provider LMAX, has been consistently gaining spot market share and now has trading volumes that are comparable to Coinbase and higher than Kraken or Bitstamp. According to analysts, next year this platform may well take first place in the BTC/USD spot market.

Also in June, CME held two sessions for $ 1.5 billion,where the total volume of open positions reached 35% of the volumes on BitMEX. It is worth noting that the maximum leverage on CME is 2.5x, so this is a greater indicator of interest than on most (or all?) Crypto derivatives retail exchanges.

Volumes on the Bakkt cryptocurrency platform are constantly growing, and the modest start was due to the fact that supplying bitcoin futures require longer adoption by market participants.

In addition, both CME and ICE will soon launch bitcoin options, which will attract new market participants interested in trading volatile bitcoin.

Thus, analysts conclude that a possible “disappointment” in the cryptocurrency market was on the side of retail, not institutional investors.

Larry Cermak, an analyst at The Block, agreed with this conclusion, noting that all signs point to a lack of participation from retail investors rather than large traders (whether institutional or "whales").