Crypto exchanges are evolving and there is a need to know what waits ahead for these market places. Crypto Lists unveil the latest reports that indicate the huge opportunities and significant risks with future crypto exchanges.
So what will future crypto exchanges be like? According to the latest report from Bitget, Boston Consulting Group (BGC) and Foresight Ventures, the market will grow at an unprecedented rate. It is still early days for crypto investors.
An overview of the reports expresses the end-state competitive landscapes and the outlook on growth avenues for these exchanges. It is expected that over 1 billion people will be crypto investors by 2030, up significantly from around 300 million users today. If you want to be rather early on the train, sign up for Bitget here!
The foreseeable future of crypto exchanges by Bitget and BCG
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- 1 The foreseeable future of crypto exchanges by Bitget and BCG
- 2 The key role of Crypto Exchanges in enabling Web3 transformation
- 3 A huge variety in holdings between various countries
- 4 What does individuals vs institutional investors select?
- 5 The future of crypto exchanges
- 6 What will future exchanges support?
- 7 High volatility will remain in 2022
- 8 Positive outlook for crypto exchanges
Crypto Lists derive findings from the joint report between Bitget, Boston Consulting Group, and Foresight ventures to dig deep into getting to know the future of crypto exchanges by assessing the development trends in the trading markets. The development trends include:
+The thriving derivative market
+Momentum of quick trading volume increase
+Impacts of regulations
The report looks into current developments in the crypto market and assesses the future paths of winning operations, and the motivating reactions of investors to the market conditions. Bitget´s marketing director, Nicole Ng, also points out that crypto trading volume needs to grow more. She points out that the two attractive regions as Latin America and the Asia Pacific have high market potential and progressive crypto regulations. BCG’s MD and Senior Partner says there is room for significant growth in the market, especially in emerging markets. Crypto exchanges contribute significantly to this growth, and with time, decentralised exchanges will also become more important and integrated in the ecosystem.
The key role of Crypto Exchanges in enabling Web3 transformation
Crypto exchanges play a significant role in enabling the Web3 economy. It looks into the navigation of crypto during a bear market.
Its primary role is to provide access, infrastructure, and liquidity for the cry. There is a particular focus on security and decreased costs to mitigate against hackers and high costs experienced with coins such as Ethereum. The exchanges must accept the dynamic market situation and change their strategy to beat their competition. The main mission is to bring Web3 solutions to traditional industries.
A huge variety in holdings between various countries
Research from Foresight Ventures estimate that North American investor in average invested 18 000 USD in crypto, while 190 USD in average comes from Africa. Unfortunately, no data is shown for Europe, Asia or South America. However, Crypto Lists expects that Dutch, British and German customers are most heavily invested, while the Scandinavian market is way behind.
What does individuals vs institutional investors select?
Some key points from the research show that option traders speculate on volatility and tries to capture the crypto markets turning points. Are we just entering a downturn again, after a few weeks of an upward trend? Or will the bull market continue? You can register for a Bitget account and discover yourself.
A bit more long term private and institutional investors often goes with crypto futures. It’s interesting to see that institutional investors only have 2% of their capital in crypto, while 25% is put in equity. Probably, a large part of the remaining investments are put in property. Meanwhile, crypto assets as a percentage of individual wealth stands at 0.3% with around 700 billion USD invested. Institutional investors make up 300 billion, or about 0.1% of the market.
The future of crypto exchanges
Bitget and Boston Consulting Group predicts that the total number of crypto users could reach 1 billion by 2030. The leading coins Bitcoin and Ethereum attract various investors whereas there are still upcoming coins. There is an expectable institutional interest growth in crypto assets with individual investors being the current big holders of crypto. The progress shows that the current willing investors are hedge funds and venture capital firms. Today, the two major coins, ETH and BTC, stands for about 45% of the daily volume. “Over time, an increasing number of smaller and fast growing coins and tokens will take way bigger market share compared to today”, says Markus Jalmerot from Crypto Lists.
South Asia has young traders who speculate and take cues from social media and the region makes up the largest market in terms of trading value. Crypto exchanges must structure themselves to accommodate this increasing interest in the industry. The exchange coins must be more decentralised and give more utility to the users. BGB token is one example that needs to spread out and improve decentralisation over time, since most of the coins are own by the company itself now, which is surprising for an exchange of this size.
Hopefully, maturity of the crypto ecosystem will contribute to the rise in the crypto market as the institutional money invested in the asset class leads to lower volatility and a maturing market profile.
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What will future exchanges support?
According to Crypto Lists expectations, there will be increased support and functions in the coming years, such as:
+More deposit methods – It should be possible for anyone to transfer anything into crypto.
+Wider range of assets – It’s likely that U.S will change their regulation in the coming years, allowing more cryptocurrencies to be purchased by Americans.
+Exchange to Exchange options – Today, only a few crypto casinos support transfers between firms, but there is no options for transfers between exchanges. When this functionality comes out, it will benefit all of the best exchanges.
+More will offer crypto futures: Today, very few exchanges offer futures trading. A majority will provide this service in the coming 3-5 years.
+NFTs are unlocking huge potential to the crypto space, says Changpeng Zhao, CEO of Binance at Quatar Economic Forum. Crypto Lists estimates that a majority of all the bigger crypto exchanges will have a NFT section in the coming years.
+Crypto platforms and exchanges will be regulated from all over the world in the future. Today, licensing and regulation is surprisingly low. In a few years from now, all exchanges will probably need a license to operate.
+More countries will follow El Salvador and allow Bitcoin as legal tender, says Changpeng Zhao, CEO of Binance, said to Bloomberg.
High volatility will remain in 2022
Crypto Lists experts predict that the market volatility will remain high in the second half of 2022. There is also a likelihood of relief rallies and many valueless tokens may not survive the year. Crypto exchanges must conduct a critical appraisal of the coins listed. The Web3 company expects the industry to continue maturing.
With BCG’s estimation of 0.3% of individual wealth held in crypto contrasting the 25% held in equities, there is room for crypto adoption to rise in retail and institutions. However, it is low compared to traditional investment assets. Crypto exchanges must drive an increase in the percentage. There is an expected rise in Bitcoin and other cryptocurrencies. Some predictions expect the bull market to start any time by the end of the year.
The crypto exchanges must mitigate the monetary policies instilled by the US Federal Reserve to calm inflation and recession. However, investors must examine global trends before making informed choices about future crypto investments.
Positive outlook for crypto exchanges
There is a positive view of cryptocurrencies despite the current market decline. Crypto Lists expect the markets to stabilize later this year. The future shows that crypto exchanges, projects, and companies with strong foundations focus on their technology in the bearish markets and launch new products to drive positivity in the industry. The future also sees positive expectations with the upcoming upgrade of the Ethereum network.
With the corporates on the scene, the future will expect the market to be more stable than bullish if there is no reason to make it go back to the bull market. Crypto exchanges will thrive with an increase in users and the stability of the industry. Several exchanges are positioning themselves for the expected changes.