Aftermarket parts help increase institutional interest in crypto

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Bitcoin and ethereum may absorb the majority of the digital currency spotlight, but it is the alternative coins that have helped spark institutional investor interest in crypto.

OKCoin, a San Francisco-based cryptocurrency exchange, noted that the volume of transactions has increased over the past year by institutional players entering the crypto space. Institutional money mainly flows in stablecoins that mimic fiat currency like the US dollar and decentralized tokens.

“OKCoin said it saw a 450% increase in the number of institutional clients on its platform between September 2020 and September 2021, as well as a 124% increase in institutional transaction volume during the same period,” said stated a Coin Telegraph article. “According to the report, 53% of institutional investor purchases made in September were for altcoins. Additionally, customers have shown “a greater appetite for non-Bitcoin crypto assets” compared to previous years. “

In particular, institutional currency has favored alt coins which are still relatively new. This move goes against what institutions have done in the past, which is to pour money into coins with at least four years’ experience.

“Institutional activity on the platform is indicative of macro sentiment among large-scale investors, with a client base comprising asset managers, venture capital and hedge funds, retail brokers, processors payment and other entities around the world, ”OKcoin said.

What are institutional investors buying?

It appears that over the past month, many institutional investors have purchased the Solana blockchain ecosystem, or, more specifically, its SOL cryptocurrency. Like Ethereum, Solana is one of the open source blockchain ecosystems that has recently gained attention for its mining efficiency and scalability.

“Other companies in the crypto and blockchain space have come to similar conclusions based on data from trading platforms,” the Coin Telegraph report noted. “In September, analysis firm Chainalysis reported that transactions over $ 10 million accounted for over 60% of DeFi transactions in the second quarter of 2021. CoinShares also reported that over a week in September, institutional interest for Solana (SOL) far exceeded that of Bitcoin (BTC) and Ether (ETH). ”

The rise of Solana has crypto market experts dubbing it as the next Ethereum or even better. One of its defining features is the use of proof of history as a consensus algorithm as opposed to proof of work, which speeds up transaction processing.

“With its price skyrocketing more than 100 times since the start of the year, its potential is becoming impossible to ignore,” said Nigel Green, CEO of deVere.

For more news, information, and strategy, visit Crypto Channel.

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