The projected future of crypto exchanges according to Bitget and BCG

CryptoChipy delves into the findings from the collaborative report by Bitget, Boston Consulting Group, and Foresight Ventures, offering a deeper understanding of the future of crypto exchanges by analyzing development trends in trading markets. The key trends include:

+The booming derivatives market
+Increasing trading volume momentum
+Innovative applications
+Effects of regulation

The report reviews current market developments and forecasts the paths for successful operations and investor reactions to market conditions. Bitget’s marketing director, Nicole Ng, highlights that crypto trading volume must continue to grow. She notes that Latin America and the Asia Pacific regions present substantial market potential and progressive crypto regulations. BCG’s MD and Senior Partner also stress the vast growth opportunities in emerging markets. Crypto exchanges are expected to play a significant role in this expansion, and decentralized exchanges will gain prominence as the ecosystem evolves.

The vital function of crypto exchanges in driving Web3 transformation

Crypto exchanges are central to the development of the Web3 economy, especially during bear markets.

Their primary function is to offer access, infrastructure, and liquidity for cryptocurrency markets. There is a particular focus on improving security and lowering costs to protect against hackers and reduce high fees, such as those on Ethereum. Exchanges must adapt to the dynamic market conditions and modify their strategies to stay competitive. Their key mission is to integrate Web3 solutions into traditional industries.

Foresight Ventures’ research shows that North American investors, on average, have invested $18,000 in crypto, while African investors invest an average of $190. Data for Europe, Asia, and South America isn’t disclosed, but CryptoChipy anticipates that investors in countries like the Netherlands, the UK, and Germany hold the largest investments, whereas Scandinavian markets are lagging behind.

Individual vs institutional investors: What do they prefer?

Research indicates that option traders speculate on volatility, attempting to capitalize on crypto market turning points. Is the market entering another downturn after weeks of upward movement, or will the bull market continue? You can create a Bitget account and explore it for yourself.

In terms of longer-term investments, both private and institutional investors tend to favor crypto futures. Interestingly, institutional investors hold just 2% of their capital in crypto, while 25% is allocated to equities, with the rest likely invested in real estate. Meanwhile, crypto assets make up only 0.3% of individual wealth, with around $700 billion invested. Institutional investors own about $300 billion, accounting for 0.1% of the market.

The future of crypto exchanges

Bitget and Boston Consulting Group predict that by 2030, the number of crypto users could reach 1 billion. Bitcoin and Ethereum continue to attract diverse investors, though emerging coins are gaining traction. Institutional interest in crypto assets is expected to rise, with individual investors currently holding the largest share. Hedge funds and venture capital firms are the key active investors today. Bitcoin and Ethereum currently account for around 45% of daily trading volumes. “Over time, we expect smaller, rapidly growing coins and tokens to capture a much larger market share than today,” says Markus Jalmerot from CryptoChipy.

Younger traders in South Asia, who are heavily influenced by social media, dominate the region’s trading volume. Crypto exchanges must adjust to accommodate this growing interest. Exchange coins will need to become more decentralized and offer greater utility to users. An example of this is the BGB token, which needs to enhance decentralization over time, as a significant portion of these tokens are still controlled by the exchange itself, which is unusual for a platform of its size.

With the maturation of the crypto ecosystem, it is expected that the market will grow as institutional investments reduce volatility and help stabilize the market profile.

What features will future exchanges support?

According to CryptoChipy, the coming years will see increased support and more features such as:

+More deposit options – Expect a variety of ways to transfer funds into crypto.
+Een bredere selectie van activa – U.S. regulations are likely to change, allowing for a wider range of cryptocurrencies to be traded.
+Exchange-to-exchange transfers – Currently, few crypto casinos support transfers between exchanges, but this feature is expected to grow.
+More platforms offering crypto futures – Currently, only a few exchanges provide this, but many will likely offer it within the next 3-5 years.
+NFTs unlocking new potential for the crypto market, as noted by Binance CEO Changpeng Zhao at the Qatar Economic Forum. CryptoChipy predicts that most large exchanges will eventually include an NFT section.
+Crypto exchanges and platforms will likely become regulated globally. Licensing and regulation are presently minimal, but soon, all exchanges will probably require a license to operate.
+More nations will follow El Salvador’s lead in adopting Bitcoin as legal tender, according to Binance’s Changpeng Zhao, speaking to Bloomberg.

High volatility expected in 2022

CryptoChipy predicts that the volatility in the market will remain high in the second half of 2022, with potential for relief rallies. Many low-value tokens may not survive. Crypto exchanges must evaluate their listed coins critically. The Web3 industry anticipates continued maturation.

With BCG estimating that only 0.3% of individual wealth is held in crypto compared to 25% in equities, there is ample room for crypto adoption to rise in both retail and institutional spaces. However, the percentage is still low compared to traditional assets. Crypto exchanges will need to drive growth in this area. A rise in Bitcoin and other cryptocurrencies is expected, with some forecasts predicting the onset of a bull market by year-end.

Crypto exchanges will need to account for the monetary policies enacted by the U.S. Federal Reserve to address inflation and recession. Investors should consider global trends before making informed decisions about future crypto investments.

Positive outlook for crypto exchanges

Despite the current market downturn, CryptoChipy remains optimistic about the future of cryptocurrencies. The markets are expected to stabilize later this year. The outlook is positive for exchanges, projects, and companies with solid foundations, who are focusing on technology during bear markets and introducing new products to foster optimism in the industry. Additionally, the upcoming Ethereum network upgrade is expected to drive positive sentiment.

With corporations entering the scene, the future is expected to be more stable than bullish, unless there’s a catalyst to push the market back into a bull phase. Crypto exchanges will thrive as user numbers increase and industry stability grows. Several exchanges are positioning themselves for these upcoming changes.