Binance Research: most large Bitcoin and Ethereum investors hold stablecoins, use cold wallets

The research arm of Binance, the world’s largest crypto exchange by trading volume, has published a report that analyzes the results of a survey completed by institutional digital asset investors. According to the report, Binance surveyed over 100 institutional and VIP clients.

Survey results cannot be generalized due to the small sample size

The Binance team mentioned that the survey results should be interpreted with “extreme caution” and must not be generalized, because of the relatively small sample size of only 41 institutional and VIP clients.

As stated in Binance’s report, over 50 percent of the exchange’s VIP clients hold positions for at least a week. Meanwhile, a third of Binance’s institutional traders take part in high-frequency trading and various other market-making strategies.

Notably, Binance’s survey results indicate that clients with a bigger portfolio tend to trade across several different exchanges, whereas clients with less capital may trade on a single or a select few platforms.

High-frequency traders increasingly engage in cross-platform arbitrage strategies

High-frequency traders, who may hold positions for less than a day, tend to trade on several different exchanges in order to engage in cross-platform arbitrage strategies. This approach allows traders to take advantage of price differentials across multiple platforms, Binance’s report noted.

Binance’s management pointed out that around 90 percent of its clients use USD as the benchmark currency. This, as USD-backed stablecoins and USD-denominated trading platforms dominate the cryptoasset industry, Binance’s report confirmed.

Nearly all institutional clients use stablecoins

The Binance team revealed that almost all survey respondents said they use stablecoins for trading purposes or as a store-of-value (SoV). While USDT remains the dominant stablecoin, PAX and USDC are also used frequently to engage in trading or to hold value, the report mentioned.

Stablecoin usage (%)…

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