Block Crypto Venue HiveEx Launches
A new report into the cryptocurrency exchange market has uncovered a bleak reality, with potentially thousands of dollars wasted by people who make large cryptocurrency trades on exchanges.
The inaugural Cryptocurrency Exchange Landscape Report was released today (Wednesday, March 28, 2018) by HiveEx.com, which is the latest business venture by the owners of Australia’s most visited financial comparison website finder.com.au, Fred Schebesta and Frank Restuccia.
HiveEx.com was launched in February 2018, and is one of Australia’s first over-the-counter (OTC) trading decks for ‘sophisticated investors’, to buy and sell large volumes of cryptocurrency at a fixed price. In its first few weeks of operation, HiveEx.com processed over $2 million across three different coins: bitcoin, Ethereum and WAN Chan.
Fred Schebesta, HiveEx.com Co-founder, wanted to launch the OTC desk after discovering the difficulty with trading large volumes on exchanges.
“After launching cryptocurrency exchange comparison Crypto Finder in September 2017, we realised that it’s super difficult to do large trades. If you tried to buy over $50,000 worth of cryptocurrency on an exchange, it usually results in ‘slippage’ of 10-15% plus fees. This is due to exchanges unable to process big trades in one transaction. The trade will usually be made over several smaller transactions and each transaction can be set at a different price.
“Other factors that impact big trades on exchanges include transaction methods, verification levels, how long a customer has been trading and the exclusivity of the platform. It can also take days for a trade to be processed on an exchange. HiveEx.com aims to solve these issues by accessing funds through liquidity providers that process large transactions outside of exchanges.
“This is only just the beginning for cryptocurrency trading, and we’re excited to be a part of the evolution that’s changing the way people do banking.”
The HiveEx.com report takes a deep dive into the cryptocurrency exchange landscape, and features a case study that compares a trade for bitcoin (BTC) of AU$400,000 on an exchange with the highest volume of trades in Australia, versus HiveEx.com. The trade quote needed to be increased to AU$407,400.62 to fit the available trade limits on the exchange’s Sell Orderbook.
It would have taken 46 individual transactions to trade this figure on the exchange, and would cost a 0.23% fee. This returned 34.31 BTC after fees were deducted. Comparatively, HiveEx.com would take one transaction and return 35.03 BTC after fees. This 0.72 BTC difference between the two providers was worth AU$8,404.34 (US$6,464.88).
A summary of the report findings can be found below;
- While it took 46 transactions for the HiveEx.com/exchange case study scenario, this can vary depending on available trade orders and trade size.
- The case study exercise was conducted at 10am on March 21, 2018, and is not indicative of future prices.
The gap in the market
- Billions of dollars worth of cryptocurrency is now being traded every day. While it’s undisclosed how many large trades are taking place, it’s likely to be potentially hundreds of trades worth hundreds of thousands – and even millions – of dollars being processed each day.
- According to data sourced from BitInfoCharts and analysed by HiveEx.com, the average trade value of bitcoin (BTC) on March 20, 2018 was US$49,258 (AU$63,996.04).
- However, the median trade value of bitcoin was US$645.29 (AU$838.63). This means that half of all BTC trades fell below US$645.29 (AU$838.63), while the other 50% of transactions fell above US$645.29 (AU$838.63) – much higher value trades are pulling the average up.
- The size of the largest trades according to info’s list of Largest Transactions ranged from 2.13 BTC (US$19,125.27/AU$24,905.08) to 581.78 BTC (US$5,223,802.62/AU$6,802,745.30) on March 21, 2018.
The growth of the cryptocurrency market
- The number of cryptocurrency exchanges has grown by 171.43% in the past 3 years. Currently, there are 190 cryptocurrency exchanges, compared to 70 exchanges in 2015.
- There are 1,568 different cryptocurrencies available, as at March 21, 2018. This includes 654 tokens and 914 coins.
- From December 2013 to the end of 2017, the number of cryptocurrencies rose from 40 to 1,273 – a 3,083% increase.
- On March 20, 2018, Ethereum recorded a peak of 661,791 trades in one day. This is an increase of +22,870.9% compared to its first appearance on the charts in August 2015.
- Similarly, bitcoin clocked in at 195,041 trades on March 20, 2018, an increase of 1,303.2% since first appearing on the charts in June 2011.
- There were over 305.61 million cryptocurrency trades recorded on March 19, 2018, according to info. This is an increase of 48.27% when compared to the 206.12 million transactions that occurred a year ago on March 18, 2017.
- The average trade value for bitcoin was recorded at US$24.82 (AU$32.25) on January 1, 2011, according to Bitinfocharts. Five years later on January 2, 2016, this amount increased to US$3,010 (AU$3,912). By November 5, 2017, it peaked at US$180,441 (AU$234,534) – that’s an increase of +726,898% since January 2011.
- Two years ago on March 22, 2016, the amount of cryptocurrency traded on major blockchain exchanges was US$21.4 million (AU$27.8 million) in a day, according to info. This value hit an all-time high on December 22, 2017, when trading volume peaked at US$5.4 billion (AU$6.95 billion). This represents an increase of +24,949.62% over the nine-month period.
HiveEx.com is an over the counter (OTC) cryptocurrency trading desk, aimed at Sophisticated/Accredited Investors, which buys and sells large volumes of cryptocurrency, at a fixed price. HiveEx.com is a subsidiary of Hive Empire Pty Ltd, which also owns comparison websites finder.com.au and finder.com.
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