Institutional Trading 2.0: Building the Digital Asset Stack

Key insights from session “Institutional Trading 2.0: Building the Digital Asset Stack” at REDeFiNE TOMORROW 2025. The discussion featured Tanawat Sutantverakun, CEO of Bitazza Thailand and Anton Katz, CEO & Co-Founder of Talos. Exploring the evolution of the market, its challenges, and the future of institutional-grade infrastructure in the crypto world.

The Evolution from a Retail-First Market to Institutional-Grade Infrastructure

Anton Katz shared the origins of Talos in 2018, a time when most infrastructure and tools in the digital asset market were built for retail users. With a firm belief in the inevitability of institutional adoption, Talos pioneered the creation of "Institutional Tooling" to connect with a market that was liquid but lacked standardization.

Since then, the market has undergone several key evolutions:

Clearer Regulations: Regulatory bodies worldwide have started to establish clear guidelines for digital assets.
CME Bitcoin Futures: The launch of Bitcoin futures on the CME was a pivotal moment that opened the door for U.S. institutions.
Credible Custody Providers: The emergence of regulated digital asset custodians has been crucial.
The Rise of Prime Brokerage: Prime brokerage services for institutional clients have begun to take shape.
The Bitcoin ETF: This has been a major catalyst for driving widespread adoption.
The Role of Stablecoins: Stablecoins have become a vital component of the digital finance ecosystem.

A significant shift has also occurred in client needs. In the early days, institutions merely wanted a single API to connect to all exchanges. Today, demand has evolved to include sophisticated tools for spread trading, portfolio management, transaction cost analysis (TCA), and reconciliation systems, reflecting the market's exponential maturation.

The Differentiating Factors: Crypto vs. Traditional Finance (TradFi)

Anton provided a compelling comparison between the two financial worlds:

Similarities: The practice of trading in pairs in crypto is familiar to FX traders, easing their transition. Meanwhile, the fragmented market structure is reminiscent of the early days of other asset classes.
Key Differences:

The 24/7 Non-Stop Market: The crypto market never closes, which has massive implications for operations, risk management, and capital efficiency. This 24/7 nature creates new challenges for institutions, forcing them to implement risk management systems and capital allocation strategies that can respond to market movements at any time, including weekends and holidays. It requires continuous infrastructure support for large-scale trades (in the hundreds of millions or billions of dollars) and robust, always-on risk and settlement processes.
Embedded Technology: The most significant game-changer is the superior capital efficiency made possible by blockchain's embedded technology. This enables real-time or even mid-day settlement, allowing for a rapid reduction of risk and freeing up of capital in a way that is unprecedented in traditional finance. This is a key reason why Anton Katz believes that "ultimately, all assets will become digital assets."

The Challenges of Building in a Volatile World

Building Talos has been a journey filled with two main types of challenges:

External Challenges: Navigating the "compounded volatility" of being a startup within the already volatile crypto sector. Managing through market shocks like the FTX collapse, which can lead to prolonged downturns, is a critical test for any emerging company.
Internal Challenges (Current): The primary challenge today is Focus and Prioritization. As the company grows and serves a large client base, requests come from all directions. The most difficult task is to clearly communicate what the company is "doing" versus "not doing" to ensure the delivery of best-in-class service in its chosen areas.

A Global Overview of Institutional Adoption

With a global client base, Talos has a unique perspective on regional differences:

APAC: Highly diverse with country-specific regulations. It is a leader in derivatives and structured products, with a population that is notably "fintech-native."
Europe: The MiCA regulation has created a more harmonized framework while also increasing protections for retail investors. This has driven the popularity of the B2B2C model, where financial service providers use specialized platforms like Talos to serve their end-clients in a compliant and efficient manner.
United States: Institutional adoption in the U.S. tends to occur in a "step function." The key driver is regulatory clarity. The environment in 2025 has shifted to be significantly more supportive of innovation, providing the confidence needed for the world's largest financial institutions to enter the market decisively.

The Talos Strategy: Becoming a "One-Stop Shop"

Talos has evolved from a trading platform into a "one-stop shop" provider covering the entire investment lifecycle, guided by a "Build, Partner, or Buy" strategy:

Build: Develop core, best-in-class solutions in-house, such as their trading systems.
Partner: Collaborate with best-in-breed providers for non-core functions, such as custody services.
Buy: Acquire companies to accelerate growth in strategic verticals, like the acquisitions of D3X and Cloudwall to enhance portfolio management capabilities.

The goal is to provide a seamless, integrated experience for clients, reducing the complexity of connecting multiple disparate systems—a major pain point for financial institutions.

The Future: DeFi, Tokenization, and the Next Steps for Talos

Looking ahead, Anton Katz reiterated his clear vision that "all assets will become digital assets," a journey defined by two key frontiers: DeFi and Tokenization.

For DeFi, the primary challenge for institutions has shifted from technology to compliance. With the development of advanced screening and monitoring tools, institutions can now access this space with greater security.
Meanwhile, for Tokenization (RWA), Talos is positioning itself as a robust "bridge" to connect the traditional financial world with the new era of digital assets.
To support these trends, Talos's next steps are focused on becoming a complete "one-stop shop." This involves advancing its portfolio management tools, creating solutions for stablecoins, and expanding support to other asset classes like FX to serve global financial institutions. The company is targeting the "next trillion-dollar institutions" entering the digital asset space and has onboarded asset managers totaling approximately $18 trillion in AUM in the past 10 months, signaling a "massive change" compared to previous years.