Crypto exchanges are set to rake in twice as much money as last year even though bitcoin is down 51%

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August 17, 2018 8:46 PM

Cryptocurrency exchanges are making money hand-over-fist this year, despite a bear market that's gripped the market for digital currencies.

Cryptocurrency exchanges are making money hand-over-fist this year, despite a bear market that's gripped the market for digital currencies.
Crypto trading revenue could more than double to as much as $4 billion in 2018, according to a new report.

Bitcoin has been stuck in the doldrums for much of 2018, but that doesn't mean every market participant is heading to the poor house.

In fact, a recent Bloomberg News report found that crypto exchanges are set to rake in twice as much money as last year even though bitcoin is down a whopping 51%, according to Markets Insider data. In total, the market for digital currencies has shed over $500 billion since it topped $800 billion in January.

Exchanges, which notably experienced outages and hacks as bitcoin soared to $20,000 at the end of 2017, make money by facilitating the matching of buyers and sellers.

Citing data from

San Francisco-based Coinbase is enjoying 50% of these revenues, Bernstein found.

Exchanges may get a further boost if they're able to lure larger investors to their platforms with so-called white-glove services.

Offering these services to large institutions — from face-to-face meetings to block trades — is one way the market could mature, experts says.

Kiran Nagaraj, KPMG's leader of cryptocurrency services, said larger investors need to be supported on crypto-specific issues such as managing crypto forks — when a crypto splits into two — for them to enter the market in a serious way. Big investors, Nagaraj says, don't want to be concerned with the technicals.

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