Hong Fang, OKX president, changed the discussion as institutional investors poured money into Ethereum. The game is not zero-sum, it’s more of a divergence in core functions. Bitcoin provides value anchoring while Ethereum creates the programmable plumbing for a new financial system. Noteworthy, the debate seems to have reshaped OKX’s playbook.
The following is a summary of the information that you will find on this page.
- Ethereum attracted billions of dollars in institutional investment, while Bitcoin experienced rare outflows. This signals a growing asset class divide.
- Hong Fang is the president of OKX and he believes that BTC, as a trust network, and ETH serve different institutional functions: BTC serves as programmable financial.
- OKX is impacted by the shift, which includes ETH derivatives as well a staking program and a standard chartered collateral program.
VanEck, a digital asset investment and research firm, published its August cryptocurrency market review on September 4th. They reported one of sharpest divergences in Bitcoin’s (BTCEthereum (ETHIn years,
You can also find out more about the following: reportThe underlying conviction of the institution was evident in “stablecoins and digital asset treasury accumulation” As the key drivers of Ethereum’s dominant performance, $4 billion was invested in ETH ETPs, while Bitcoin ETPs saw $600 millions in withdrawals.
This shift has helped Bitcoin drop from its five-year peak of 65% to just 57%, two months after the change. Ethereum’s rise was also reflected in the price. ETH grew by nearly 16 percent in August, while Bitcoin fell more than 7%. This shows the increasing separation between how institutional investors are positioning themselves around Bitcoin and Ethereum.
Two weeks after the report, crypto.news had a Q&A interview with OKX President Hong Fang, who framed the trend as more than just a trading rotation. Fang claimed that Bitcoins and Ethereums no longer directly compete for the institutional capital. Each network is now a separate asset class.
Ethereum, a programable finance platform and bitcoin as trust
Hong Fang, in a conversation with Crypto.news warned that August’s assets were not merely a flip-flop between them. The institutional divergence is indicative of structural changes, according to Hong Fang.
Crypto.news: VanEck’s data shows Bitcoin ETPs have seen net outflows whereas Ethereum has experienced strong inflows. Does this reflect a short rotation by the institutions, or is it a longer-term reassessment?
Hong Fang ETH volume growth on OKX over the past few months shows more and more people are beginning to see Ethereum as a backbone for programmable financial systems. Even though the ETH/BTC is low, it’s about the conviction that ETH offers. DeFiThe role that on-chain innovations plays in the future of innovation is growing.
Bitcoin and Ethereum share the same foundation. Bitcoin is the foundation of the blockchain ecosystem. Ethereum, on the other hand, provides the platform for new products and services, as well as programmability and customer empowerment.
CN: What is the impact of this trend on OKX? Are you launching or speeding up any Ethereum-centric services specifically for institutions as a response?
Fang: We have consistently supported Ethereum products — including ETH-margined derivatives, structured trades, and staking – which give institutional clients robust exposure and operational flexibility.
We are focused on building the foundational infrastructure. This is evident in our program of third-party collateral mirrored with Standard Chartered. It allows institutions to use tokenized assets, including ETH, and money market fund as collateral held securely by a global systemically-important bank.
Rather than chasing the market cycle, we focus on solutions that improve institutional access, security and future-proofing, while ensuring transparency in custody and capital efficiency.
The cycle of transparency and trust in institutions
Fang also highlighted the importance of transparency in institutional adoption. Fang’s comments were made in conjunction with the publication by OKX of its 35th proof of reservesThe report, which covered nearly three consecutive years of reporting without interruption, verified assets worth $37.7 Billion.
CN: You can find out more about this by clicking here. Do you have plans to develop the proof-of reserve reporting system so it can go beyond just ratios, and start showing insights into customer behaviours such as shifts from self-custody to staking.
Fong: The Proof-ofReserves is a commitment we have made to long-term transparency and accountability. In fact, we’re about to hit three years of publishing monthly PoR reports – something we began before many exchanges and have continued long after the spotlight moved on. This consistency is crucial because the goal is not to simply follow trends, but rather give customers confidence in their assets.
Since then, we have increased coverage by 22 assets and introduced the zk-STARK privacy-preserving technology. Verification has also been made more efficient through a reduction in proof file size. Hacken and other respected auditors provide an independent review of the audit results. This adds another level of assurance. Trust is the ultimate goal of Proof-of Reserves. We’ve made our transparency DNA by being consistent each month, and raising the bar every year.
CN: In the next twelve months, which milestone do you think will be the most significant for OKX? Market share, regulatory approvals or the release of a new flagship product will all be considered.
Fong: Over the next year, our goal is to keep building momentum in markets where we’re already licensed – growing our teams, investing locally, and expanding our reach. Blockchain should be used to solve real problems, such as payments, asset movements, and self-custody.
This strategy includes our shift to unifying USD liquidity. By combining USDC, USDG, and USDC in one single order book we can reduce fragmentation of the market and create a more efficient and deeper capital markets.
OKX’s success is based on building trust and a strong regulatory relationship, as well as building lasting technology with practical applications. These foundations will lead to innovation and growth, which is why we are able to continue setting the standards for responsible growth in our industry.
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Source: crypto.news
