What Exchanges Must Do to Win Institutional Crypto – Insights from Gold-i’s Tom Higgins

What Exchanges Must Do to Win Institutional Crypto – Insights from Gold-i’s Tom Higgins

The major crypto exchanges are competing fiercely to capture institutional business. If they are to do this successfully, they might want to listen to the experience of Tom Higgnis, CEO of Gold-i. Tom has nearly 20 years building connectivity for FX and seven years applying the same principles to digital assets. Speaking exclusively to LiquidityFinder, Higgins offers some blunt advice to exchanges looking to increase their institutional volumes.

Higgins shares his thoughts on what crypto exchanges keep getting wrong about institutional adoption, why major venues are losing flow to competitors, and how infrastructure providers like Gold-i are quietly solving the biggest challenges in the market.

From FX bridges to the plumbing of institutional crypto

Gold-i’s MatrixNET began life as an FX aggregation and routing engine. Today, it sits at the centre of the digital asset liquidity ecosystem, connecting:

▪️ Centralised exchanges

▪️ Market makers

▪️ ECNs such as Crossover

▪️ Institutional DeFi venues like HyperLiquid

These venues use wildly different APIs — FIX, REST, WebSocket, bespoke blockchain protocols — and Gold-i’s core value is normalising them into a single institutional-grade interface.

“You’re normalizing all of these different liquidity sources that all have different APIs… into a single API. From that, you can choose any of 30 or so venues and create aggregated pools or individual pools.”

For institutional desks who expect FIX, stable streams and transparent counterparty models, this normalisation is the gateway into digital assets.

Why DeFi is still off-limits — and why CEX structure matters

Higgins is clear about the practical divide between centralised and decentralised exchanges.

🔹 On a centralised exchange, the counterparty is the venue.

🔹 On a decentralised exchange, the counterparty is anyone, with no KYC, no supervision, and no guaranteed behaviour.

“Banks can almost never use a decentralized exchange because there cannot be any KYC. The chances of you dealing with a criminal are pretty high because you have no idea who is on the other side.”

For institutions — whose compliance departments demand known counterparties, operational predictability and separation of functions — CEXs are the only logical path for now.

But even CEXs are failing to meet institutional expectations in critical areas.

The structural gaps exchanges must address

Higgins points to several deep-rooted issues holding back institutional adoption — all of which originate from exchanges’ retail-first mindset.

1) Liquidity fragmentation and inconsistent venue behaviour

Outside the top coins, liquidity varies dramatically. Market makers may disappear in volatile moments; exchanges update at different speeds; order book behaviour is unpredictable.

As Higgins says, “In FX, liquidity is generally pretty good quality and consistent. It isn’t in crypto… sometimes it will behave in a different way than you would expect.”

Institutions need stability, depth and predictability, not retail-style patchwork liquidity.

2) Cloud-based architectures, not institutional data centres

FX and equities venues live in LD4, NY4, TY3 — with decades of ultra-low-latency engineering behind them. Most crypto exchanges live in AWS.

That’s fine for retail trading, but not for HFT firms or institution-grade routing logic. Institutions need exchanges to:

▪️ Improve determinism and update rates

▪️ Standardise infrastructure

▪️ Offer predictable latency environments

3) Lack of separation between custody, execution and clearing

This is arguably the single biggest blocker.

In TradFi, these functions are separate by design. In crypto, exchanges historically did all three.

“Custody, clearing and settlement, execution – these things are separate entities in the institutional world… [Institutions] are not comfortable putting their money with one exchange.”

This is why institutional custodians like Zodia and Copper have emerged — and why exchanges that fail to plug into them will fall behind.

Case study: Binance’s VIP pricing misstep — and how OKX won institutional flow

The best demonstration of how exchanges misunderstand institutions is Binance’s change to its VIP pricing tiers.

Historically, prime brokers and aggregators could combine the trading volume of thousands of underlying clients under one master account and achieve a top-tier VIP level. Everyone benefited.

“If you were Hidden Road, you would have one account, you could have a million sub-accounts and all those sub-accounts’ volumes would add up together.”

Then Binance changed the rules.

Instead of aggregating sub-accounts, Binance applied VIP tiers per sub-account. That meant:

🔸 Every small fund lost its institutional discount

🔸 Aggregators could no longer mutualise client volume

🔸 Costs went up sharply

🔸 Flow shifted to competitors within weeks

“All of these thousands of small ones are now on a very poor VIP rate… and the fact they aggregate together to be big, they don’t care.”

OKX immediately benefited.

“OKX gained a lot of market share when Binance changed their institutional charging… OKX didn’t do that, because they thought that was stupid.”

The lesson is simple:
👉 Institutions operate through aggregators. Exchanges must design pricing and infrastructure that respects aggregation — not penalises it.

Where technology fits: making crypto behave like any other asset

Institutions don’t want bespoke crypto workflows. They want crypto to fit into the systems they already trust.

Higgins explains: “Their systems probably talk FIX… Suddenly, their systems can receive streaming prices in any of these assets just like they can in anything else, and they can send orders and get executions back in them like they can in anything else.”

MatrixNET enables this by:

🔹 Standardising CEX, MM and DeFi liquidity into one FIX/WebSocket stream

🔹 Mixing exchange and market-maker books to stabilise pricing

🔹 Allowing exchanges to offer FIX-native institutional connectivity instantly

🔹 Supporting cross-asset flows (FX, indices, equities and digital assets in one stream)

This is exactly what institutions expect — and what most exchanges fail to provide natively.

Who relies on MatrixNET?

Gold-i serves two main groups:

1) Liquidity sellers

Prime brokers, prime-of-primes, and institutional aggregators using MatrixNET as their execution layer.

2) Liquidity buyers

Brokerages, prop firms, hedge funds, asset managers and exchanges themselves.

Many exchanges use MatrixNET to:

🔹 Deliver FIX connectivity

🔹 Create institutional pricing curves (VWAPs and multi-level ladders)

🔹 Integrate into taker networks like oneZero, PrimeXM or Centroid

🔹 Expand institutional distribution without building dozens of integrations

“If you have a new venue you want to work with… our client says, ‘off you go’, and we come back a couple of weeks later and say, ‘off you go’.”

This is how institutional crypto scales.

“We sit between traditional finance and digital assets… we link those two worlds and that’s where all the money is.”

The bottom line: exchanges must evolve — or institutions will trade elsewhere

Crypto exchanges want institutional capital.
Institutions want reliability, governance, separation of roles, FIX connectivity and fee structures aligned with how institutional markets work.

Right now, most exchanges are still retail platforms trying to look institutional, and institutions recognise the mismatch immediately.

The winners in the next phase of digital asset adoption will be:

✅ Exchanges that upgrade their market structure to institutional standards

✅ Custodians that specialise in safe asset storage

✅ Technology providers like Gold-i that connect the two worlds

Institutions will enter digital assets more deeply — but only once the market feels as robust, as safe and as operationally disciplined as the markets they already trade.

Author

Sam Low is the Founder of LiquidityFinder. With over 18 years in working with FX trading technology, Sam has deep experience in the FX (forex) trading industry, working with brokers, liquidity providers and end traders themselves.  You can message Sam directly here.