Leading crypto prime broker capped record levels of activity in 2021 with strongest quarter to date in Q4
During 2021, Genesis completed over $300 billion in global crypto transactions
Strong activity underscores expanding global institutional interest across digital assets
NEW YORK, January 27, 2022--(BUSINESS WIRE)--Genesis, a digital asset industry pioneer and digital currency prime brokerage, today released its Q4 2021 Market Observations Report, which provides detail on the company’s growth over the past quarter and the whole year. This growth highlights major trends across institutional digital asset markets, including the continued diversification of digital asset investments, the deepening sophistication of institutional investors entering the crypto market, new types of institutions participating in the market, increasing allocations from managers of diversified portfolios and the growing need for multi-service institutional prime brokerages.
Q4 2021 marked Genesis’ strongest quarter to date, with approximately $102 billion in transactional volume, cementing a year of significant growth across all of its business lines. Highlights during the quarter across crypto lending, trading and custody include the following:
Loan originations reached $50 billion, up 40% over Q3 2021. Loan originations for 2021 totaled $131 billion, nearly 7x higher than 2020.
Spot trading volume totaled $30.8 billion, up 23% from Q3. For the full year 2021, Genesis’ spot trading volumes increased nearly 6x over 2020 to $116.5 billion.
Derivatives notional volume traded was $20.7 billion during the quarter, an increase of 62% compared with Q3. Total notional value traded for the year grew to $53.8 billion, more than 9x over 2020.
Onboarded Custody clients grew 53% from the previous quarter.
Genesis’ headcount expanded 22% during the quarter to reach 170 employees, spread across three continents.
"2021 was a pivotal year for the crypto industry, and one that demonstrated the merits of smart tactical trading around a core position," said Michael Moro, CEO of Genesis. "As this asset class continues to mature, driven by increasing institutional participation and growing regulatory clarity, we believe that taking a comprehensive approach to portfolio management will only become more important, and we look forward to achieving new milestones on behalf of our clients in 2022."
Genesis’ lending desk remains the largest crypto lender in the industry and finished the year with over $150 billion in cumulative originations since its launch in March of 2018. Genesis executed a record $50 billion in new originations in Q4 alone, a 40% increase from the previous quarter, and marked the desk’s fifteenth consecutive quarter of growth. Active loans outstanding climbed to $12.5 billion to close the quarter, up 12.3% from Q3. Loans outstanding peaked at over $16 billion in mid-November before seeing a wave of year-end deleveraging as prices on most cryptocurrencies fell.
Over the quarter, the lending desk saw that while demand from clients engaging with DeFi platforms is still strong, focus has shifted towards layer-1 (L1) alternatives, resulting in slightly higher originations in those coins.
Derivatives and Spot Trading
Genesis saw another record quarter in derivatives trading activity with $20.7 billion in notional value traded globally, a 62% quarter-on-quarter growth and a 360% increase over Genesis’ results in Q4 2020. This brings trading activity for 2021 to $53.8 billion in notional volume, an 812% increase over 2020. In December, Genesis also printed the first ever ETH Micro futures trade on the CME and was #1 in market share for blocked BTC and ETH exchange-cleared options via Paradigm, with over $1.5 billion traded.
The Genesis spot desk traded $30.8 billion in volume in Q4, delivering the second-best quarter in the desk’s long history, as well as an increase of 23% over the prior quarter and a 279% increase over Q4 of 2020. Total spot trading volume for the year reached $116.5 billion, a 463% increase over 2020.
Genesis Custody closed 2021 with a 53% increase in the number of customers onboarded from Q3. The business also reached two critical milestones during Q4 一 Genesis Custody was approved by the Financial Conduct Authority (FCA) as a cryptoasset business, signifying its strong controls, governance and compliance frameworks to counter financial crime, and it completed the System and Organization Controls (SOC) 2 Type 1 examination.
Over the course of Q4, Genesis Custody also began staking assets for clients. The business has taken steps to continue to expand its portfolio of services offered, and to better integrate custody into its clients’ trading and portfolio management workflows.
The Genesis Q4 2021 Market Observations Report provides a comprehensive look into key market activity through insights from the firm’s spot trading, derivatives trading, lending, custody, treasury and prime brokerage businesses. To read the full Q4 2021 Market Observations Report, click here.
Genesis is a full-service digital currency prime brokerage providing a single point of access for select qualified individuals and global institutional investors. Genesis combines unrivaled operational excellence, a seamless user experience, and best-in-class client service to provide the full suite of services global investors require to manage their digital asset portfolios.
The firm offers sophisticated market participants a fully integrated platform to trade, borrow, lend, and custody digital assets, creating new opportunities for yield while increasing capital efficiency for counterparties.
Genesis is a wholly owned subsidiary of Digital Currency Group (DCG), one of the largest private investors in blockchain and digital asset companies.
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