Okcoin, one of the world’s largest and fastest-growing cryptocurrency platforms, today reported a 125% increase in institutional trading volume from Q1 to Q2 2022, the fourth consecutive quarter of institutional trading activity more than doubling. Okcoin’s clientele—which includes traditional finance trading firms, prime brokers, asset managers, venture and hedge funds, and more—grew by 13% in Q2 and by 28% in the first half of 2022. Besides bitcoin (BTC) and ether (ETH), stablecoins tether (USDT) and circle (USDC) were the most popular among institutions in Q2, with purchases of USDT increasing by 116% and USDC increasing by 47% from Q1.
In the first half of 2022, stablecoins accounted for 33% of asset buys and bitcoin for 40%, amidst a bear market whereby the crypto market value declined over 60%. This is a marked difference in institutional activity from the previous prolonged bear market, which lasted from 2018 to 2020. Institutions held outsized BTC positions during that time, with stablecoins accounting for just 6% of purchases during the lowest six-month period whereby the crypto market value declined 70%. During the most volatile periods of this recent market downturn, the Okcoin exchange systems experienced 100% uptime and no disruptions to client trading.
“Despite the market downturn, institutional activity on Okcoin continues to reflect increasing crypto interest and greater sector maturity,” said Jason Lau, COO of Okcoin. “Whereas in 2018 we saw institutions liquidate their crypto holdings in response to the bear market, nearly all of our clients are seeking greater exposure this time around and taking a longer term view. Further, in 2018, the institutions that did stay in the market focused almost exclusively on trading bitcoin, deeming stablecoins and other altcoins too much of an additional risk. In 2022, they’re trading dollar-backed stablecoins almost as much as bitcoin — likely considering them to be ‘risk-off’ crypto assets, given their lesser volatility.”
Since receiving its ISDA membership in the spring of 2022, Okcoin has been working on ISDA contract negotiations with institutional clients and developing NDF and options products set to be launched later this year. Bilateral OTC derivatives are in demand by traditional institutional clients who cannot hold crypto on their balance sheets, but still want to gain crypto exposure for hedging or speculation.
For more information, please visit okcoin.com/institutions.
Founded in 2013, Okcoin is a US-headquartered cryptocurrency exchange serving 190+ countries and territories. The platform enables retail and institutional investors to purchase 50+ digital assets using local currencies, with a mission to make crypto easy for everyone including first-time buyers. Okcoin was the first centralized exchange to offer direct entry into decentralized finance (DeFi) with Earn, a tool for earning APY through decentralized lending, liquidity pools, staking, and more. In addition, Okcoin offers institutional trading tools and APIs to asset managers, venture capital and hedge funds, retail brokers, payment processors, and more. Follow Okcoin on Twitter at @Okcoin and visit okcoin.com for more information.