Tuesday 15 December 2020 10:46 am

The Year in Review - The 2020 Crypto OTC Market

Covid is on the blockchain. No it’s not. That was a crypto and Covid joke in one! 

A trader I spoke to today said that 2020 has been a great year for our personal accounts and awful for just about everything else. Covid has defined 2020 for so much of the world and in my view it has also affected the cryptocurrency markets. Remote online working and shopping and living became the norm in 2020 and with that came an acceptance of a remote, online form of currency which doesn’t require physical form.

OTC trading is the biggest trend in cryptocurrency right now. Trading activity has spiked in recent months leading us all to believe it shall never come to an end and BTC/USD is destined to remain above $18,000 for ever and ever. I run an OTC platform so god I really hope so. 

We are seeing so much interest in USDT. It is incredible to see the demand for a product that only allows investors to take their USD and turn it into a pegged cryptocurrency that they can squirrel away…Like you I see headlines such as “Bitcoin Consolidates Safe Haven Status” and cringe a little. This is the familiar argument… “The downturn has forced investors to think about reliable safe-haven assets and together with gold, Bitcoin can preserve value in the long run. Its deflationary model and indestructibility make it the right candidate for the list of must-have assets.” Our industry gets so caught up in itself it believes that a cryptocurrency that increases 3x in 2020 is because we all only just discovered right now that it was a safe haven asset because the Fed is printing money and there is unlimited QE globally… I thought this Government activity started in 2008 and has just continued unabated but maybe the crypto crowd only just realized it in 2020.

My sarcasm ends here. Institutional attitudes to cryptocurrency changed in 2020. Not sure why, I think it was Covid that made us all realise that if the way we interact with the world can change overnight then our perception of what is currency can change as well. HNWI, Family Office and Institutional demand have all driven the increases we are seeing in OTC markets. 

According to otctrade.com, a June 2020 Fidelity survey that showed that more than a third of institutional investors in the US and Europe own cryptocurrencies, with Bitcoin the most popular. In the US alone, 27% of institutional investors confirmed that they held crypto assets, up from 22% in 2019. In Europe, 45% of firms admitted they held crypto assets.

Imagine the returns at Greyscale this year if it follows its forecast of owning nearly 3% of the world’s BTC stock by the end of this month.

Institutional investors prefer to buy Bitcoin directly, with no slippage, discretely and efficiently. Competition in our space is increasing with many retail platforms starting to operate OTC desks. We at HAYVN are currently under an approach by a large exchange to acquire the business. Jingle bells jingle bells.

Merry Christmas to all. 

by Christopher Flinos, Co-Founder at HAYVN 

Crypto AM: Technically Speaking in association with Zumo