The chief commercial officer of Auros, Jason Atkins, has raised alarms about a critical issue affecting the cryptocurrency markets: liquidity. Speaking ahead of the Consensus event in Hong Kong, Atkins emphasized that the primary challenge facing the sector is not volatility, but rather the lack of adequate liquidity.
Despite an increase in institutional interest in cryptocurrencies throughout 2025, limited market liquidity continues to be a significant barrier. This condition prevents large institutional players from participating in the market without triggering substantial price disruptions. Atkins articulated that it is misleading to conclude that institutional investors are eager to engage if the necessary conditions for their involvement are absent.
“It”s one thing to say, “we”ve convinced them to come now,”” Atkins stated. “It”s another to ask, “Do you have enough room for everyone?”” His comments reflect growing concerns among industry analysts about the market”s capacity to accommodate substantial institutional demand.
As the conversation surrounding liquidity gained traction, Atkins reiterated that this issue has worsened due to diminishing market interest. He pointed to significant sell-offs, such as the crash on October 10, which have occurred at a pace faster than traders and leveraged positions can re-enter the market. This scenario has resulted in market makers prioritizing risk aversion over demand generation, exacerbating volatility and leading to even tighter liquidity conditions.
Atkins contended that the situation cannot improve if institutions are expected to stabilize the market while it remains weak. He noted that the absence of a natural safety net during turbulent times leads to a self-reinforcing cycle where volatility, caution, and illiquidity diminish market performance, despite favorable long-term returns.
While volatility alone does not deter major investors, the real issue arises when high volatility coincides with weak market conditions. Atkins acknowledged that navigating volatility in thin markets is challenging, making it difficult for investors to safeguard their holdings or execute timely sell-offs.
Moreover, Atkins highlighted that the current landscape presents greater difficulties for institutions compared to individual traders. He pointed out that large investors have adopted conservative capital preservation strategies, limiting their willingness to accept liquidity risks. “At that level of wealth, or if you are a huge institution,” he remarked, “it”s not just about getting the highest returns. It”s about getting the best returns while keeping your capital safe.”
In closing, Atkins expressed skepticism regarding the narrative that funds are flowing from cryptocurrencies to artificial intelligence projects. He argued that these two sectors are at different stages of development, with the recent surge in AI interest not leading to an exodus from the crypto ecosystem.
