FalconX Launches New Prime Brokerage Service for Institutional Investors to Trade on Exchanges

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Cryptocurrency trading firm FalconX has unveiled a new prime brokerage service designed to facilitate institutional investors’ trading activities on exchanges while their funds remain securely held in regulated, bankruptcy-remote custody. 

The service, known as Prime Connect, offers a range of features including post-trade settlement, institutional-grade credit, and portfolio margining. 

In a recent press release, FalconX announced that Deribit, the world’s leading cryptocurrency options exchange, is the first platform to integrate FalconX’s prime broking and custody solution.

Prime Connect Comes as Crypto Recovers From FTX Collapse

The launch of Prime Connect comes as the cryptocurrency industry reevaluates the importance of safeguarding client assets in custodial setups that are entirely separate from those of exchanges, brokers, and trading firms. 

The collapse of FTX, a notable event in the industry, has heightened awareness of the need for robust security measures and strict segregation of assets.

Vivek Chauhan, the product manager at FalconX, expressed enthusiasm about the launch of Prime Connect and the partnership with Deribit. 

“We are pleased to launch Prime Connect with Deribit and look forward to providing our full suite of prime services which allow institutions to confidently scale their digital assets portfolios while trading on exchanges.”

Hyperithm, alongside other trading firms, has already begun utilizing Prime Connect to facilitate trading activities on Deribit. 

FalconX has plans to integrate its services with additional exchanges in the coming months, expanding the availability and reach of their prime brokerage solutions and reaching more investors.

“We are thrilled to be the first exchange that FalconX is partnering with to launch its off-exchange settlement solution,” said Luuk Strijers, CEO of Deribit. 

“This collaboration marks a significant milestone in providing institutional investors with access to our offering coupled with FalconX’s full suite of prime services that will enhance client trading capabilities and financial flexibility.”

CEX Trading Volume Triples in 2024

Centralized cryptocurrency exchanges (CEXs) like Binance experienced a large surge in trading volumes between October 2023 and March 2024, according to Bybit’s 2024 Institutional Industry Report released on April 18.

Notably, OKX saw a 278% increase in 30-day volumes since October, followed closely by Binance, which saw a 239% surge. 

Bybit exchange also demonstrated impressive growth, adding 264% to its trading volumes during the same period.

These exchanges have outpaced the industry’s average growth rate of 255%, as confirmed by a spokesperson for Bybit. 

The U.S.-based exchange Coinbase also witnessed growth, albeit slightly trailing behind with a 193% increase in trading volume.

However, the CEX growth hasn’t surpassed the even more rapid expansion of decentralized exchanges (DEXs). 

Leading DEX Uniswap v3, for instance, saw a 320% increase in volumes during the same period, as highlighted in Bybit’s data.

As reported, Uniswap has surpassed $2 trillion in lifetime trading volume.

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