More than 65% of the daily trading volume on South Africa’s biggest cryptocurrency exchanges is made up of trades above 0,5 bitcoin (BTC) – or about R100 000.
More than 75% of the volume is above 0,25BTC – around R50 000.
This is according to data gathered by cryptocurrency platform Coindirect.
Nic Haralambous, chief operating officer of Coindirect, says the platform has seen an increase in serious traders and investors making large volume trades over the last six months.
“There are many people in South Africa who have dipped their toes into the world of cryptocurrency. These customers account for a very small percentage of the daily trading volume,” comments Haralambous. “These are traders who are still learning the ropes and getting comfortable with the idea of crypto. After doing research into the local trade sizes and general volumes, we noticed that it’s the serious traders who are really moving the needle. A handful of people are doing most of the large trades seen each day.”
Cryptocurrency is no longer a niche internet project dreamed up by an obscure human over a decade ago. It’s starting to take shape as a global financial system that is changing the way people interact with money and understand investment opportunities.
Cryptocurrency is seen by some as an investment, while others consider it a store of value and a relevant part of a diversified portfolio. Regardless of the investor’s needs, as it stands in South Africa, buying large amounts of cryptocurrency frequently requires a massive investment of time and knowledge to make the economics work.
Cryptocurrency traders who perform large volume transactions normally do manual research to source the best Bitcoin prices and lowest fees in the market, due to Bitcoin prices having no centralised market price. For most of them, this comes at a time cost that makes the market difficult to navigate efficiently. Usually these traders need to do multiple trades across many platforms throughout a day. This can be very time consuming and often frustrating for traders looking to buy large volumes of cryptocurrency.
Coindirect’s brokerage service is changing the way serious traders buy large amounts of cryptocurrency. The dynamic over the counter (OTC) service, the first of its kind in South Africa, targets high value investors by offering traders a price guarantee. In order to offer traders the best Bitcoin price, Coindirect has the widest pool of liquidity sources in the country. This enables it to process large transactions at a guaranteed price, that isn’t susceptible to market fluctuations.
“We are excited to bring this institutional model of trading to South African crypto traders. The combination of the Coindirect brokerage and wallet service allows traders to act confidently and quickly when they are hunting for the best crypto prices. These are crypto traders who know what they want and when they want to do it. Coindirect is addressing this clear market niche and providing traders a platform that will give them the tools to do just that,” Haralambous concludes.
* The rand values of bitcoin are approximate and calculated at the time the research was concluded in September.