Crypto isn't going to see exchange consolidation for 2 reasons, according to trading exec

It seems like it's almost every month that a new exchange launches in the cryptocurrency market. 

Over the last year, a number of new crypto marketplaces have come online including derivatives players like CoinFLEX and institutional-aimed venues like AAX in the United Kingdom. In the last few months, The Block data shows that legitimate trading volumes on spot crypto exchanges is down more than 50% since June. 

The increase in competition and decline in volumes might seem like the perfect recipe for consolidation, but Max Boonen, the chief executive officer of over-the-counter trading firm B2C2 says that is not the case. 

"I used to think they would consolidate, but I don't think so," he said on a recent episode of The Scoop

He noted two reasons. First, he said the 2017 boom provided many exchanges with a solid war chest to stay in business and compete. At the same time, captive user-bases keep clients trading on various platform. 

"I mean, Kraken and Coinbase all of those guys are doing healthy volumes and some of them managed to have a somewhat captive user-base."

Boonen added that newcomers that offer a new kind of user experience have also seen a significant growth:

"And you see that with a lot of the newcomers, right? Binance. Incredible success story. How long did it take for Binance to really take off? Less than six months. There's a few new exchanges, CoinFlex, FTX, those guys in a few months have really taken market share."

He thinks that the market structure of crypto will look like FX in which there will be many brokers to choose from. 

"You know, you have dozens of FX Brokers that you can pick from, obviously some bigger than others. But it's possible that we're just never going to have consolidation or it's going to be at the margin. It's not necessarily going to be, you know, exchanges dying left and right."