You Won’t Believe How Much Institutional Crypto Trading Has Exploded in 2024 | Finance
The
over-the-counter (OTC) institutional cryptocurrency market experienced a
significant uptick in the first half of 2024, with total spot transaction
volumes soaring 95% year-over-year.
According
to a new report from Finery Markets, which analyzed two million spot trades
conducted by institutions, the appetite for digital assets among institutional
investors grew significantly. This surge in activity follows recent approvals
for crypto-related investment vehicles, including the successful launch
of a Bitcoin ETF.
Ethereum,
the second-largest cryptocurrency by market capitalization, saw its trading
volumes rise by 32% in the first half of 2024 compared to the same period in
2023. The potential approval of Ethereum ETFs is expected to further drive
institutional participation in the market.
“The
recent approval of crypto-related vehicles has sparked institutional interest
in adopting crypto for the long term,” Finery
Markets commented in the report. “However, we believe that the full
impact of ETF approvals on the market may not be fully realized until six to
nine months later.”
The report
also highlights a shift in trading patterns, with crypto-to-crypto trades
demonstrating a 50% year-over-year growth. In contrast, crypto-to-fiat pairs
decreased by 12% in the first six months of 2024. Notably, transactions
involving stablecoins across all blockchains and layers surged 2.6 times
year-over-year.
Experts
have acknowledged for several months that without the support of institutional
investors, the volumes and prices of Bitcoin would not have increased as
significantly. For
instance, the cryptocurrency market experienced a substantial surge in
value, growing from $1 trillion to $2.5 trillion from October 2023 to March
2024.
Altcoins on the Rise
While
Bitcoin and Ethereum continue to dominate the space, the report indicates
varying growth rates among altcoins. Tron (TRX) experienced the most
significant surge, with a 202% year-over-year increase, followed by Binance
Coin (BNB) at 129% and Litecoin (LTC) at 80%. However, Ripple (XRP) bucked the
trend with an 18% decline.
“The growth
rates seen in altcoins can largely be attributed to a low base effect resulting
from a downturn in the first half of 2023, which was caused by the collapse of
FTX and its subsequent impact on the cryptocurrency market until the first half
of 2024,” Finery Markets added.
Source: Finery Markets
The
cryptocurrency market’s growth accelerated in the second quarter of 2024,
achieving a 110% year-over-year increase in customer transaction volumes, up
from 80% in the first quarter. April saw the peak growth rate at 158%
year-over-year, following a 56% increase in January.
Despite the
overall positive trend, institutional participation in altcoins remained
relatively low, with the top five alternative cryptocurrencies accounting for
just 5.4% of the total trading volume.
The report
suggests that the changing regulatory environment is becoming more favorable
towards digital assets, providing traditional financial institutions with a
clear path to enter the crypto space using established financial instruments.
Finery Markets
is the first crypto ECN to receive the SOC 2 Type 1 certification. Earlier this
year, Finery Markets established
a collaboration with Hidden Road. This partnership is characterized by
incorporating Finery Markets’ leading product, FM Liquidity Match, into Hidden
Road’s activities, which primarily involve prime brokerage services for crypto
spot transactions.
The
over-the-counter (OTC) institutional cryptocurrency market experienced a
significant uptick in the first half of 2024, with total spot transaction
volumes soaring 95% year-over-year.
According
to a new report from Finery Markets, which analyzed two million spot trades
conducted by institutions, the appetite for digital assets among institutional
investors grew significantly. This surge in activity follows recent approvals
for crypto-related investment vehicles, including the successful launch
of a Bitcoin ETF.
Ethereum,
the second-largest cryptocurrency by market capitalization, saw its trading
volumes rise by 32% in the first half of 2024 compared to the same period in
2023. The potential approval of Ethereum ETFs is expected to further drive
institutional participation in the market.
“The
recent approval of crypto-related vehicles has sparked institutional interest
in adopting crypto for the long term,” Finery
Markets commented in the report. “However, we believe that the full
impact of ETF approvals on the market may not be fully realized until six to
nine months later.”
The report
also highlights a shift in trading patterns, with crypto-to-crypto trades
demonstrating a 50% year-over-year growth. In contrast, crypto-to-fiat pairs
decreased by 12% in the first six months of 2024. Notably, transactions
involving stablecoins across all blockchains and layers surged 2.6 times
year-over-year.
Experts
have acknowledged for several months that without the support of institutional
investors, the volumes and prices of Bitcoin would not have increased as
significantly. For
instance, the cryptocurrency market experienced a substantial surge in
value, growing from $1 trillion to $2.5 trillion from October 2023 to March
2024.
Altcoins on the Rise
While
Bitcoin and Ethereum continue to dominate the space, the report indicates
varying growth rates among altcoins. Tron (TRX) experienced the most
significant surge, with a 202% year-over-year increase, followed by Binance
Coin (BNB) at 129% and Litecoin (LTC) at 80%. However, Ripple (XRP) bucked the
trend with an 18% decline.
“The growth
rates seen in altcoins can largely be attributed to a low base effect resulting
from a downturn in the first half of 2023, which was caused by the collapse of
FTX and its subsequent impact on the cryptocurrency market until the first half
of 2024,” Finery Markets added.
Source: Finery Markets
The
cryptocurrency market’s growth accelerated in the second quarter of 2024,
achieving a 110% year-over-year increase in customer transaction volumes, up
from 80% in the first quarter. April saw the peak growth rate at 158%
year-over-year, following a 56% increase in January.
Despite the
overall positive trend, institutional participation in altcoins remained
relatively low, with the top five alternative cryptocurrencies accounting for
just 5.4% of the total trading volume.
The report
suggests that the changing regulatory environment is becoming more favorable
towards digital assets, providing traditional financial institutions with a
clear path to enter the crypto space using established financial instruments.
Finery Markets
is the first crypto ECN to receive the SOC 2 Type 1 certification. Earlier this
year, Finery Markets established
a collaboration with Hidden Road. This partnership is characterized by
incorporating Finery Markets’ leading product, FM Liquidity Match, into Hidden
Road’s activities, which primarily involve prime brokerage services for crypto
spot transactions.
Read More:You Won’t Believe How Much Institutional Crypto Trading Has Exploded in 2024 | Finance