FX: Cryptocurrency exchanges expand offerings as concerns remain

Data from the Cambridge Centre for Alternative Finance’s 2017 Global Cryptocurrency Benchmarking Study indicate that almost three quarters (72%) of large cryptocurrency exchanges now provide trading support for two or more cryptocurrencies.

Bitcoin is supported by all exchanges, while of the remaining 1,273 cryptocurrencies in existence, as of November 8, the most commonly traded are ether and Litecoin.

Study participants report cryptocurrency trading in 42 different national currencies and more than half (53%) of exchanges support national currencies other than the five global reserve currencies, although the market is dominated by the four national currencies US dollars, euros, yen and onshore renminbi.

Among the findings of the study was that, despite many cases of internal fraud and bankruptcies of centralized exchanges, peer-to-peer exchanges have yet to gain traction. Of the 51 exchanges surveyed, only two provide a decentralized marketplace for exchanging cryptocurrencies.

The cryptocurrency exchange community has watched eagerly as Wall Street investment banks and regulators have grappled with the implications of an explosion in interest. Some observers now believe products that straddle the worlds of cryptocurrency and regulated derivative exchanges are imminent.

Harpal Sandhu, CEO of Integral, suggests that cryptocurrency exchanges lag traditional FX exchanges in terms of speed, resilience and support, although he also expects new entrants to radically transform the services offered to traders.