The digital currency market is evolving fast: The changes that it took the US cash equities markets to make over the past 25 years, the digital currency market likely will make in five years.

“And we already in year two,” Chad Cascarilla, CEO of cryptocurrency exchange itBit, told Markets Media.

The most significant market change in the past three to four years has been the introduction of institutional money into the market, he added.

As the customer base has changed from early adopters to sophisticated investors, so has their expectations.

“Early adopter in this space are increasingly concerned with custody and safety of their funds held by exchanges or wallets,” said Cascarilla.

Of the institutional investors, high net-worth clients, and family offices outpace hedge funds regarding trading volumes.

“However, I would say that some of the most significant participants in this space now are market makers and high-frequency traders, who would be the same ones you would find in the US and global equity and fixed income markets,” he noted. “The large market-making firms are very active.”

If the market makers and high-frequency traders had their druthers, Cascarilla is sure that they would like to have access to the same tools like co-location and special order types that they have in other electronic markets.

“But the market is not mature enough for those yet,” he added. “There is still a lot of money to be made in arbitraging between the various exchanges.”

Cascarilla also noted that the digital currency market still lacks much of the infrastructure needed for high-frequency trading, such as standard market data and trade messaging formats.

“It is something that I think everyone wants to move towards, but they are at very formative stages,” he said. “Everyone one has a different regulatory regime. There is not a common regulator, and everyone is getting pulled in different directions.”

Institutional investors looking to book trades of more than $1 million, which frequently happens throughout the day, tend to trade over-the-counter rather than on digital exchanges.

itBit offers an OTC agency trading desk that matches institutional investors, according to Cascarilla. “It’s a function of what the buyer and seller agree to, which is determined by what is going on in the market that day.”

For those institutional investors who cannot, or prefer not, to trade the spot market, they can gain exposure to bitcoin via the derivatives markets, he added. The CME Group and Cboe Global Markets each launched bitcoin-based futures contracts at the end of 2017.