Strong Links Between Traditional Banking and Crypto

May 26, 2020 08:27 AM
Our internal metrics have consistently shown lower volumes on both weekends and holidays
Crypto ecosystem still relies on traditional banking rails
Crytpo and Bitcoin Market Cap Story of Day






Crypto prices are unchanged today with few coins in the top 10+ or -2%. Volume remain depressed as much of the financial world returns from holiday


Markets were quiet yesterday amid a slew of global bank holidays. These days are periodic reminders that traditional banking and crypto continue to have strong links.

By mid-morning yesterday, spot volumes were about ~30% of the 30-day average. It's no coincidence that this activity drop occurred on a day where major traditional global money centers like New York and London were closed for a long weekend. While data is difficult to aggregate across the broader crypto landscape, our internal volume metrics have consistently shown lower volumes on both weekends and holidays.

Takeaway: We take the opportunity every so often to look at a day like yesterday as a reminder how, in spite of being philosophically at odds in many ways, the crypto ecosystem still relies on traditional banking rails to function and grow. By a wide margin, the majority of fiat/crypto conversions happen via wire. As a result, the ability for any crypto transaction to settle on a weekend or holiday is greatly impacted. There are some banks, like Silvergate's SEN system, which allow for client-to-client settlement within the bank's infrastructure 24/7. This, however, is primarily reserved for exchanges and OTC dealers where typical customers, in most circumstances, are excluded. The dynamic partly explains some of the correlations still seen in large market moves between crypto and traditional risk assets. Much more significant levels of adoption and spending use cases will need to emerge for crypto to become truly independent.

About the Author

FRNT Financial is a technology and sales layer that offers institutional and accredited investors access to various forms of exposure to crypto-assets. You can subscribe to FRNT Financial Morning Note at