Institutional investors are just as prone to FOMO as retail, says Circle Trade exec

Large investing firms aren't that different from the everyday trader, according to the head of trading at one of the largest OTC crypto shops. 

Speaking during an Reddit AMA, Circle Trade's Dan Matuszewski said even large institutions are "prone to FOMO as everyone else it's just bigger numbers." Still, there are some differences between OTC activity and trading on retail exchanges, he said. 

"There's a large subset of OTC trading activity that's not speculative it's purely balance sheet management for larger corporates that have a crypto component to their business," Matuszewski added. 


Keep up with the latest news, trends, charts and views on crypto and DeFi with a new biweekly newsletter from The Block's Frank Chaparro

By signing-up you agree to our Terms of Service and Privacy Policy
By signing-up you agree to our Terms of Service and Privacy Policy

Over-the-counter trading desks are known to handle larger trades than retail exchange venues, such as Coinbase and Kraken. Tabb Group estimates that volumes in OTC markets for crypto could be 2 to 3 times larger than exchange volumes. 

It's not just the size of the OTC market that differentiates it from retail markets, Circle's Matuszewski says. 

"Think of OTC as a subset of everything you see trading on public exchanges," he said. "In terms of drivers of OTC trading activity verse what moves retail exchange volume most OTC trading activity tends to have a longer time horizon and thesis behind it but the same factors that go into putting on or taking off an investment are largely the same for both groups."

Circle Trade had an impressive 2018 despite the bear market, executing more than 10,000 OTC trades with nearly 600 unique counter parties. In total, the firm facilitated $24 billion worth of trading.

About Author

Frank Chaparro is Host of The Scoop podcast and Director of Special Projects. He also writes a biweekly newsletter. Chaparro started his career at Business Insider, where he specialized in the intersection of digital assets and Wall Street, market structure, and financial technology. Soon after joining Business Insider out of Fordham University, Chaparro was interviewing top finance and tech executives, including billionaire Mark Cuban, “Flash Boys” star Brad Katsuyama, Cboe Global Markets CEO Ed Tilly, and New York Stock Exchange President Tom Farley. In 2018, he become a sought after reporter in the crypto world, interviewing luminaries such as Tyler Winklevoss, the cofounder of Gemini, Jeremy Allaire, the CEO of Circle, and Fundstrat head Tom Lee. For inquiries or tips, email [email protected].