Hina Sattar Joshi is Digital Assets Sales Director at TP ICAP.
What trends are getting underway that people may not know about but will be important?
Bitcoin has dominated the crypto market this year and for good reason. In its early days it was used as a new way of facilitating payments and after it gained popularity, it was thought of as a store of value. However, a new theme has already emerged whereby Bitcoin is being used as a base layer protocol that developers can build upon. There are many projects on the Bitcoin ecosystem which enable smart contract functionality and decentralized applications, allowing for greater interoperability between bitcoin and other blockchain ecosystems. This could dramatically expand Bitcoins utility beyond just being “digital gold”.
Another trend underway is yield farming, whereby investors who hold cryptocurrency can get further interest for lending or staking their assets. This is gaining traction as interest rates globally are being cut. New innovations are emerging in these areas to make them more secure and user-friendly. Staking-as-a-service is now widely available to institutional and retail investors, and we expect this to become more prominent in the future in the wholesale market.
What industry trends have been prominent but will soon fade?
As we entered another cryptocurrency bull run in 2024, the price action on meme coins returned bringing in the FOMO (Fear of missing out) factor. Many people were drawn to the crypto market to trade tokens, even those without clear use cases or solid fundamentals.
We believe this will fade as the market matures and faces increased regulation. There is growing awareness of the risks of “pump and dump” schemes and token scams. The market is shifting toward projects with more solid use cases, real-world applications, and regulatory compliance.
What were the key themes for your business in 2024?
2024 will go down as the year of institutional adoption, with the most notable new product being the launch of Bitcoin spot Exchange Traded Funds (ETF’s) in the United States. Institutions were able to gain exposure to cryptocurrencies without dealing with the complexities of directly holding them. We were able to service a new wave of investors through these products.
We also saw another theme of bridging the gap between Crypto and Traditional Finance (TradFi). TP ICAP was at the forefront of this, being a traditional player in the crypto market and servicing many traditional clients whilst working alongside many reputable crypto native firms to offer diversified liquidity, smoother trading and settlements between the two worlds.
And lastly, we saw a growing investment from institutional players such as asset managers, banks and hedge funds across a number of crypto related products ranging from the CME derivatives markets, ETFs, spot cryptocurrency as well as investing into crypto companies. We believe this is only the start and will continue to grow as crypto regulations around the world are established.
