Cryptocurrency trading volumes have already surpassed those of the largest public stock markets, with daily transactions exceeding $16 trillion. The annual trading volume of FAANG equities is second only to cryptocurrencies, according to Ark Investment Management analyst Yassine Elmandjra, with $12 trillion recorded.
FAANG stocks are stocks that reflect technology companies like Facebook, Amazon, Apple, Netflix, and Alphabet, which is Google’s parent company. The annual increase in bitcoin trading volumes, according to Yassine, is “almost 8-fold larger than 2020.”
The second quarter’s totals exceeded $460 billion, representing a 1550 percent increase year over year from $28 billion. Surprisingly, institutional trading volume has accounted for the vast majority of total trading volume. In Q2 2020, institutional trading volume was $17 billion, but by Q2 2021, it had climbed to $317 billion.
Aside from that, the significant growth is most likely tied to the Bitcoin run in late 2020 and early 2021. The largest cryptocurrency enjoyed a 260 percent bull run in October-December 2020. All other cryptocurrencies jumped on the bandwagon since they are linked to Bitcoin. Despite the fact that the April-May 2021 rally ended with a 55 percent drop, volume has been quite consistent.
Several institutions began offering crypto-related services during the upswing in order to profit from the optimistic trend in the cryptocurrency market. One of them is Ark Investment, which has acquired considerable private investor funding to help them reach their goal.
Businesses have been able to respond to the demand for crypto-linked financial services by increasing their offers. According to our data, BTC was trading at $44,848 at the time of writing, up 12.9 percent in the previous seven trading sessions.
Ethereum, the second-largest cryptocurrency, was trading at $3,144, up 15.4% in a week. Furthermore, the total cryptocurrency market value has risen by 3.44% in the last day to $1.92 trillion. Nonetheless, the cryptocurrency economy is still facing a plethora of challenges. For example, unsustainable digital assets using proof-of-work consensus mechanisms, the largest of which being Bitcoin, have been accused.
Senator Elizabeth Warren of the United States has been outspoken in her opposition to “ecologically destructive cryptocurrencies,” arguing that Bitcoin consumes more energy than a country. In addition, SEC Chair Gary Gensler has asked for expanded regulatory authority to combat the financial threat posed by cryptos.
The US Department of Justice is now investigating Tether, the largest stablecoin, and its management for alleged financial wrongdoing. The SEC is investigating Ripple (XRP) for allegedly providing unregistered securities. The authorities have also included crypto exchanges like Binance and crypto companies like BlockFi on its blacklist.