Binance leaks the Crypto Investment Strategy of Institutional Players
New analysis from global cryptocurrency exchange Binance reveals the trading strategies of its most significant VIP and institutional clients.
The company’s research team reviewed data from 76 firms, funds and institutions with crypto allocations ranging from $100K to over $25 million.
The three most commonly followed investment strategies were high-frequency prop trading (35.5%), technical analysis (25.0%), and market-making (19.7%).
54% of respondents kept their cryptoasset portfolio between 1-10 coins, a characteristic reflected across all investment and trading strategies.
Regulations remained one of the critical aspects of interest, both as a risk and a potential growth driver for the future of this industry.
Researchers also focused on the use of the controversial stablecoin Tether. According to the report,
“USD Tether (USDT) remained the most widely used stablecoin (40%), for reasons quoted such as greater liquidity and higher market capitalization than its peers. While alternative options are also being used, stablecoins backed by exchanges, like USDC (Coinbase, Circle) and BUSD (Binance), seemed to spark more prominent interest from many respondents than other (than USDT) fiat-backed competitors.”j
Regarding Bitcoin versus the altcoin market, institutional and VIP clients expect BTC to maintain a market dominance of 69% by the end of 2019.
BTC dominance is currently teetering around 66.4%, at time of writing, far outpacing Ethereum in second place at around 8%.
The Binance team says different types of traders and investors reference research reports to inform their decisions, with long-term traders relying more heavily on research than high-frequency proprietary traders.
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