The Shocking Truth About Institutional Crypto Investment in 2025 with Brandon Mulvihill
🎯 Summary
Podcast Episode Summary: The Shocking Truth About Institutional Crypto Investment in 2025 with Brandon Mulvihill
This 45-minute episode features host Tony Edward interviewing Brandon Mulvihill, Co-founder and CEO of Digital Asset Trading Technology (Crossover Markets). The core discussion revolves around the critical need to import mature TradFi market structure—specifically lessons learned from the FX market—into the nascent cryptocurrency ecosystem to unlock massive institutional volume growth, projecting a move from the current $3.5 trillion monthly ceiling toward $35 trillion.
1. Focus Area
The primary focus is Institutional Crypto Market Structure and Execution Technology, drawing direct analogies between the Foreign Exchange (FX) market and digital assets. Key themes include the limitations of current crypto execution models (Central Limit Order Books or CLOBs), the necessity of separation of duties (custody, market making, brokerage), and the massive friction caused by high execution costs compared to FX.
2. Key Technical Insights
- ECN Model Superiority: Crossover Markets is pioneering the Electronic Communication Network (ECN) execution model in crypto, contrasting it with the dominant CLOB model. ECNs provide takers of liquidity with their own dedicated market data sessions, preventing adverse selection and leading to tighter spreads and better pricing for retail brokers.
- Microsecond Execution Speed: Crossover Markets achieves execution speeds of 6 to 7 microseconds, positioning them as orders of magnitude faster than any other crypto venue. This speed is attributed to the expertise of their CTO, Vlad Ryzen (who previously built the fast FX venue FastMatch), and is achieved by avoiding on-chain settlement for execution due to blockchain’s inherent latency (hundreds of milliseconds).
- Off-Chain Execution for DeFi: The team is receiving inbound interest from DeFi protocols seeking to leverage Crossover’s technology to execute trades off-chain rapidly, posting only the final result back on-chain for transparency, thereby addressing the speed and cost issues plaguing current DeFi execution.
3. Market/Investment Angle
- Volume Ceiling and Fee Compression: Current centralized exchange volume is capped around $3.5 trillion monthly because the vertically integrated/brokerage business models artificially keep fees high (hundreds of dollars per million vs. $2-$5 per million in FX). Unlocking true institutional volume requires fee compression driven by competition.
- M&A Catalyst: Mulvihill predicts that once regulatory clarity (like the passage of a specific bill, possibly referencing the Genius Act for stablecoins) is achieved, M&A activity will skyrocket as traditional Wall Street players buy their way into the digital asset space.
- Credit Over Real-Time Settlement: The industry is “over its skis” focusing solely on real-time settlement. The more critical gating item for institutional adoption is market structure around credit and netting. Forcing immediate settlement creates synthetic liquidity and market efficiency problems for sophisticated market makers who rely on netting positions over longer time horizons.
4. Notable Companies/People
- Brandon Mulvihill: CEO of Crossover Markets, bringing nearly 20 years of experience from building institutional FX businesses at FXCM (FXCM Pro) and building a prime brokerage from scratch at Jefferies.
- Vlad Ryzen: Crossover Markets CTO, whose prior success includes building the high-speed FX venue FastMatch (sold to Euronext) and developing the trading framework (AES) used for Credit Suisse’s dark pool, Crossfinder.
- Gemini, Celsius, 3AC, FTX: Mentioned in the context of the severe market turbulence (crypto winter) Crossover Markets navigated while building its institutional platform.
- Propi: A sponsor mentioned for leading the charge in putting real estate on-chain, using Coinbase for crypto escrow.
5. Regulatory/Policy Discussion
The passage of the Genius Act in the US, aimed at standardizing dollar-backed stablecoins, is seen as a positive step that will make FX markets more efficient by improving settlement capabilities, though the broader market structure evolution is deemed more critical.
6. Future Implications
The industry is moving toward a best-of-breed model characterized by a clear separation of duties (custodians, market makers, brokers, third-party venues), mirroring mature asset classes like FX. This structural maturity, driven by competition, is the prerequisite for crypto volumes to break past the current $3.5 trillion ceiling.
7. Target Audience
Institutional Investors, Crypto Traders, FinTech Professionals, and Market Structure Architects interested in the technological and structural hurdles preventing mainstream institutional adoption of digital assets.
🏢 Companies Mentioned
đź’¬ Key Insights
"what it is is when we execute a trade, we rank every liquidity provider in real time based on behavioral characteristics."
"but the third thing that I'm really excited about... is our best bid offer in smart order routing. Really what we think is the most sophisticated best execution business model in the world in crypto."
"And so, you know, they're kind of principally focused on tokenization of real-world assets, bringing those things on-chain, really smart."
"The biggest gating issue for a large-scale institution coming in is not necessarily regulation. They want to custody their coin at a name that's familiar to them where they custody dollars or other assets."
"But what's more important for this industry is getting TradFi custodians into the space in a meaningful way."
"And those are market structure moves. So when I think about the ETF, that was super important, but it's not a change in market structure."