Institutions Must Reject the Retail Playbook and Back Utility-Driven Crypto
Institutional inflows into crypto have raised derivatives volume and market activity but have not delivered technological maturity or real economic utility. The opinion argues that institutional investors should stop emulating retail behavior—chasing narratives, token-driven speculation and short-term volatility—and instead focus on projects with sustainable revenue models, non-token-dependent operations and demonstrable product-market fit. Key data points cited: global crypto derivatives volumes surpassed $79 trillion in 2025 and institutional holdings rose to about 24%, concurrent with a retail exit. The author (Diego Martin, CEO of Yellow Capital) recommends building TrustFi-style infrastructure that abstracts complexity for users, confidential trading using zero-knowledge proofs to prevent front-running, and decentralized unified clearing protocols to solve market fragmentation. M&A and scaling for trading volume alone are viewed as insufficient; the next wave should prioritize privacy, clearing, and revenue-bearing primitives to enable multi-cycle resilience and meaningful integration with TradFi. Primary keywords: institutional investors, crypto derivatives, decentralized clearing, privacy, TrustFi.
Neutral
The article is strategic and prescriptive rather than reporting a disruptive event—it critiques current market behavior and outlines infrastructure priorities. Short-term market impact is likely neutral: the piece may modestly reduce enthusiasm for speculative, token-centric trades among some institutional readers, but it does not announce new regulation, large capital movements, or product launches that would immediately shift prices. Cited metrics (e.g., $79 trillion derivatives volume, 24% institutional holdings) reflect existing market structure rather than a new shock. Over the medium-to-long term the recommendations—privacy (ZK), decentralized clearing, and revenue-bearing projects—if adopted widely by infrastructure builders and major market participants, could be bullish for on-chain settlement, institutional adoption, and assets tied to utility protocols. Conversely, a continued focus on derivatives and volume without utility risks recurring volatility and slower fundamental growth, which would weigh on risk assets. Historical parallels: past cycles where TradFi entry increased derivatives activity (e.g., 2020–2022 institutional product launches) produced elevated volumes but limited protocol-level adoption until infrastructure (custody, compliance, OTC clearing) matured. Traders should therefore treat this as a thematic signal: favor protocols with clear revenue models, privacy features, and clearing integrations for longer-term exposure, while maintaining caution on highly token-dependent speculative plays in the near term.