Institutional Digital Asset Trading Shifts Towards Specialized Service Providers
As institutional participation in digital assets grows, the way firms trade is starting to change. Execution quality, access to liquidity and the separation of credit and execution are becoming increasingly important. Brandon Mulvihill, Co-Founder and CEO of Crossover Markets, spoke with Traders Magazine about what institutions should look for in a trading venue.
Mulvihill emphasized that fee-inclusive execution costs are only one measure of venue quality. True institutional buy-side clients are extremely focused on total cost to trade, which includes execution cost as well as cost of capital. The use of prime brokers is increasingly becoming the headline story, notably as bank-side custody comes online.
Mulvihill noted that combining custody, execution, market making, and listing services under one roof can create structural conflicts for institutional participants. The vertically integrated model holds clients captive, introducing unnecessary risk, and can lead to dislocation events where exchanges go down and liquidate clients at prices the exchanges themselves determine unilaterally.
Mulvihill highlighted that CROSSx, Crossover Markets' trading platform, has seen significant growth with over 110+ institutions trading on it. The platform's ability to scale and its proprietary Smart Order Matching execution model deliver Best Bid Offer based on price, size, and time, while re-ranking liquidity providers in real-time.
Mulvihill expects the market structure to evolve towards more specialized service providers rather than vertically integrated exchanges as regulatory clarity becomes tangible and bank-side custody grows. Crossover Markets is uniquely positioned for this environment, with low operational costs and the ability to handle high volumes without material budget increases.