Crypto exchanges could earn $4 bn in revenue in 2018 due to trading fees: Bernstein

Trading fees are expected to rake in as much as $4 billion in revenue this year for crypto exchanges, according to research firm Sanford C. Bernstein & Co. This could mean that the crypto market is far from collapse, even though it has witnessed a worrying downtrend over recent days. Trading of virtual currencies generated $1.8 billion in fees at the largest crypto exchanges last year, analysts wrote in a report titled “Crypto Trading -- the Next Big Thing is Here?” The research was first reported by Bloomberg. These fees roughly translate to around 8 percent of the total revenue seen on traditional exchanges. It is important to note that this calculation done by the analysts was based only on transaction fees. See also: Crypto Facilities adds Bitcoin Cash contract; joins company’s existing Bitcoin, Ethereum, XRP & Litecoin futures contracts “As the crypto-asset class seasons and institutional demand builds, there are a plethora of opportunities for traditional firms,” the analysts said. Traditional firms refers to custodian, asset management and market-making services. However, on account of regulatory uncertainty and extremely unstable prices, the traditional financial industry has treated cryptocurrencies with extreme caution. Few big names in the space are slowly testing the waters, to see what can be gained from blockchain technology and possibly, cryptocurrencies.

Hesitation over cryptos could give Coinbase competitive edge

But this caution from the financial sector could spell good news for Coinbase, a U.S.-based crypto exchange. Coinbase is backed by traditional banks, exchanges and venture capital firms. Unless Wall Street becomes more engaged in the space, Coinbase could end up with an “unassailable competitive position”, the analysts said. See also: Bitcoin & cryptocurrency miner of Norway receives bombing threat for creating ‘noise’ According to the research, Coinbase currently has the lion’s share of total transaction revenues, at around 50 percent. But it is unlikely that the financial industry will immediately venture into crypto trading, unless there is more clarity on regulations, the research added. Image via Shutterstock Join our Telegram group