FTX US Reports 512% Increase in Average Daily Volume in Q3
Business sets sights on growth in derivatives and NFTs, its president says.
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key takeaways
- FTX US President Brett Harrison attributes successful Q3 in part to sports partnerships and platform usage by institutional investors
- Company’s growth in trading volume and users came as Coinbase reported a quarter-over-quarter decrease in those categories
The average daily trading volume of crypto derivatives exchange FTX US affiliate jumped by 512% during the third quarter as the company capitalized on partnerships and new business lines.
FTX US reported an average daily volume of roughly $360 million in the third quarter, a 512% increase from the prior quarter. Its peak total volume during a 24-hour period, which occurred on Sept. 7, was $807 million.
The business held about 4.5% of the US crypto spot market, as of Sept. 30, which was up from 2% at the start of the third quarter.
FTX US’s user count increased by 52% quarter over quarter, though the company declined to share how many users it has.
Bringing the product suite of Blockfolio, which FTX bought last year, under the FTX umbrella has helped create more awareness for the brand, according to Brett Harrison, the president of FTX US. He also attributed the business’s growth in part to its parent company’s many partnerships, such as with high-profile athletes like Tom Brady and Steph Curry.
“The crypto world is still in limbo about whether the traditional world will accept them as legitimate or not, and having a celebrity sign-on is a huge nod of approval that the rest of the world will follow suit,” said Ty Smith, founder and managing director at crypto marketing agency Coinbound.
FTX US has also been actively utilizing its alliances with Major League Baseball and the Miami Heat.
The company, for example, offered fans at the Heat’s first game a free NFT commemorating the opening night upon signing up for an FTX account. FTX also made a $10,000 donation for each home run of at least 425 feet hit during the MLB postseason. The player with the longest homer was able to donate the full total to a charity of his choice.
“We’re now really being able to activate those partnerships and use them to advertise for our brand, to run promotions, to run giveaways and get people excited about signing up for our product,” Harrison told Blockworks.
The recent growth garnered by FTX US contradicted Coinbase’s reported user base and trading volume, which fell in the third quarter.
The largest cryptocurrency exchange platform in the US saw its monthly transacting users drop about 16% from 8.8 million in Q2 to 7.4 million in Q3. Though total assets on the platform increased, trading volume fell 29.2% from $462 billion to $327 billion during that span.
Harrison noted that unlike Coinbase, which primarily makes its revenue off of retail volume, about 60% of FTX US’s volume comes from institutions, such as proprietary trading firms, high-frequency trading firms and hedge funds.
“They continue to make markets and trade and go long or short in different environments regardless of what’s happening with crypto prices,” he explained.
Focuses moving forward
FTX US increased its headcount by 30% during the third quarter, primarily in areas of compliance, know-your-customer (KYC) and anti-money-laundering (AML), Harrison said. It will continue building out its team in these departments, he added, as well as in marketing, legal, social media and customer support.
The acquisition of LedgerX, which has since been rebranded as FTX US Derivatives, will allow the company to offer licensed crypto futures and options to its retail and institutional customers.
FTX US saw an influx of Institutional demand after the purchase in anticipation of the new offerings, Harrison said.
The company most recently added Mark Wetjen, a former commissioner of the Commodity Futures Trading Commission, as head of policy and regulatory strategy.
He will lead the company’s communications with the CFTC, the Securities and Exchange Commission (SEC) and various House and Senate Committees. He will also advise the company on its compliance standards and reporting operations and will continue to serve on FTX US Derivatives’ board of directors.
“It starts now — the hard work of getting the right product approved with the CFTC to be able to offer it to institutional and retail customers,” Harrison explained. “Our goal is to be able to offer margins, bitcoin, Ethereum, futures and options, likely cash-settled, to our customers and integrated with the FTX US platform.”
FTX US is also focused on rapidly expanding into the NFT space. The business saw a “huge bump” in users after launching its NFT platform for Solana-based NFTs.
It will now work on adding support for Ethereum-based NFTs, and look to continue making it easier for people to trade them.
“Many of our partnerships with these athletes involve NFTs and intellectual property that can be used for NFTs in some way,” Harrison said. “To really be able to activate those and bring exclusive NFTs to the FTX marketplace that no one else has, we really want to improve our offering there.”
Editor’s note: Average daily trading volume for the third quarter was about $360 million. An earlier version of this story reported it as $360 billion. We regret the error.
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