Institutions are increasing their participation in digital asset markets. They do it in different ways. Banks are adding institutional crypto trading desks for their clients (Goldman Sachs), enabling crypto payments between clients (JPMorgan Chase), and investing in cryptocurrencies. (Morgan Stanley). Tech companies and global giants like MicroStrategy and Tesla buy and hold Bitcoin. Fidelity Crypto funds allow trading of Bitcoin and Ethereum. Together with BlackRock, the company is the leader in Bitcoin spot ETFs with over $958 million in trading volume. This article explains how institutional trading platforms facilitate corporate cryptocurrency trading and provides some valuable tips for choosing the right platform.
What is an institutional trading platform?
Such platforms provide specialized financial infrastructure to facilitate the trading activities of institutional investors. The institutional platform provides the following services:
- Advanced trading tools.
- Research and risk management measures.
- Direct market access.
- Robust liquidity for making large trades.
- Market making program.
- List tokens on an exchange.
- aid and support.
- storage solution.
Now let's take a look at how to choose the best exchange for trading.
Tips for choosing an institutional trading platform
When choosing a platform for investing, consider the following characteristics:
- Liquidity. Institutional exchanges should have deep order books and be able to trade a wide range of assets. With sufficient liquidity, large trades are possible.
- safety. Check the platform's track record and reputation. Find out what safety measures we have in place and evaluate how well your user profile is protected. Financial institutions that handle large amounts of money and often work on behalf of their customers have no margin for error.
- compliance. Educational institutions are constantly under increased scrutiny from regulators and must meet their requirements and follow their rules. The exchange you use must comply with existing regulations and provide reporting tools.
- commission. Many institutional crypto exchanges offer discounted fee structures to investors due to high trading volumes.
- speed. Because time is of the essence when it comes to trading, it is critical for financial institutions to complete transactions quickly, efficiently, and with minimal downtime.
- OTC (over-the-counter) desk. These desks are important when large block trades need to be processed. Such transactions must be covered by insurance and other agency services.
- tool. Charts, technical analysis indicators, and various types of order books are valuable tools for financial institutions.
Institutional crypto trading is a very predictable phenomenon. Due to the growing interest in digital assets, more people are starting to participate in them. This will stimulate institutions to keep up and even exceed the pace of adoption. The role of institutional exchanges in the adoption of cryptocurrencies is central, as they facilitate convenient and secure transactions for companies entering the cryptocurrency sector.
