Aite Group estimates that about 65% of all cryptocurrency trading volume will happen in the OTC market in 2019.
The cryptocurrencies market has rapidly evolved and matured over the past three years, with growing numbers of active crypto-exchanges, increasingly fragmented liquidity among exchange venues, and reduced average bid-ask spreads. But the growing prevalence of over-the-counter trading desks and dark pools, while beneficial to institutional market participants who wish to trade block-sized orders, has made the overall trading landscape even more complex and difficult to navigate, leaving market participants in search of institutional-grade tools. Aite Group’s latest report, Institutional Crypto-Trading Platforms: Blockchain Meets Block Trade, examines the recent market structure development and the current trading landscape of the cryptocurrencies market.
“Market participants are in desperate need of tools to help them achieve reliable trade execution with a better understanding of their transaction costs, efficient allocation and position management, risk management, and compliance and reporting goals,” explains Gabriel Wang, analyst at Aite Group.
This report identifies key elements of an institutional-grade electronic trading platform for cryptocurrencies and profiles four such platforms: Caspian, Deltix, Tagomi, and Trading Technologies. It is based on 10 qualitative interviews Aite Group conducted in 2019 with executives from cryptocurrency exchanges, cryptocurrency OTC trading firms, dark pools, and buy-side firms trading cryptocurrency instruments.