Crypto investors are increasingly exploring beyond the top three cryptocurrencies as the market downturn continues, according to Robinhood’s head of crypto, Johann Kerbrat.
“I think what we see from our customers is that they actually see it as an opportunity,” Kerbrat told Cointelegraph during an exclusive interview, adding that they are seeing it as “an opportunity to buy the dip.”
“So we actually see a lot of customers continuing to trade crypto and diversifying, not just on the top two or three assets, but actually going pretty wide,” he said, referring to the largest two cryptocurrencies by market capitalization, Bitcoin (BTC) and Ether (ETH).
The Altcoin Season Index recorded a Bitcoin Season score of 33 out of 100 on Sunday, showing investors are still heavily favoring Bitcoin over altcoins. Source: CoinMarketCap
It signals that investors are potentially becoming more comfortable with crypto as an asset class, including its volatility and market swings.
Investors have a “very clear view” on Bitcoin and Ethereum
It comes just months after Coinbase Asset Management president Anthony Bassili told Cointelegraph in November that the average investor still hasn’t reached a clear consensus on what the third crypto asset beyond the top two warrants serious attention.
“The market is very unsure as to what’s the next asset they want to own after that,” he said, adding that Solana (SOL) is “maybe” the third asset on the radar. Bassili said at the time that there is a “very, very clear view” in the community in terms of Bitcoin being the first priority, followed by Ethereum.
Institutional crypto asset trading platform MidChains CEO Basil Al Askari told Cointelegraph that “we’re seeing full-scale asset managers entering with very large block trades going into predominantly the top 20 assets.”
“Not necessarily smaller cap altcoins, or not necessarily into DeFi or yield products,” Al Askari said, adding, “it’s baby steps.”
“I don’t think it’s impossible to see large investment managers and funds build specific teams around strategies that do different things along the risk curve, and so I do think that’s very possible,” Al Askari said.
Crypto holders are looking for use cases
Meanwhile, Kerbrat said he’s also seeing more crypto holders on the platform not just holding their tokens, but actively using them.
Kerbrat said staking has gained “very strong traction” since Robinhood rolled out the feature in December, and that more crypto holders are now exploring decentralized finance (DeFi) despite the market uncertainty.
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“It’s been pretty fun to see, to be honest. It’s always surprising,” Kerbrat said.
It comes as overall crypto sentiment has weakened, with the Crypto Fear & Greed Index remaining in “Extreme Fear” since the start of February.
Meanwhile, US spot Bitcoin exchange-traded funds (ETFs) have posted five consecutive weeks of net outflows, with investors pulling roughly $3.8 billion from the products over the period.
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