According to sFOX, execution through crypto dark pools rose from negligible volume in April to 15% of monthly volume by June, while OTC routing reached 77.7% of institutional volume against only 18.4% to public exchanges. Dark pool volume in May alone reached $147 million, and sFOX’s institutional clients route orders through 14 to 19 platforms each month. Diana Pires of sFOX compared this shift to the restructuring that equity and foreign exchange markets went through, noting that large orders are now split into smaller pieces by OTC desks before reaching public order books, making whale movements invisible to retail investors. This evolution tightens spreads and reduces slippage but deprives retail investors of visibility into the direction, size, and identity of large institutional orders. Pires expects crypto trading to end up resembling equities, where retail investors route orders through brokers that compare prices across multiple venues.
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