Opportunities & Obstacles in Digital Assets Trading

Opportunities & Obstacles in Digital Assets Trading

On 26th April, BEQUANT hosted its augural crypto capital introduction event at the Biltmore Hotel in Mayfair, London. As part of the event, our Director of Institutional Sales, David Brickell, hosted a panel discussion on the opportunities & obstacles in digital assets trading. 

Joining David were Dave Askey from AWR Capital, Sarah Crabb from Simmon & Simmons, Joseph Ziolkowski from RELM Insurance and Magnus Graham from Campion Capital. 

David asked what are the characteristics that differentiate digital assets trading and what makes it such an appealing asset class to investors that would otherwise be in other alternative funds. 

Dave Askey from AWR Capital said the interest was the opportunity for outsized returns. “You're looking at traditional finance where returns have not been great really for quite some time now and crypto has offered those outsized returns…It's a very fragmented and segregated market. And it's that at the moment I think that's providing a lot of opportunity.”

David then asked what are the strategies that you think investors should be paying attention to? Joseph said there needs to be a more basic understanding of the core strategy that asset managers are proposing. “It comes down to some fundamental kind of risk management considerations for I think a lot of investors right? Understanding counterparty risk and understanding, you know, what sources of financial recovery exist in the event that trades go wrong or custodians fail to provide safe custody.”

Sarah Crabb from Simmons & Simmons agreed. “I think it's really about diversification as well. So investors are seeing this as a new asset class and something that they can see the alpha opportunities in and something that they really want to get involved in. And as I said I've been working with these types of funds for a long time.”

“Five years ago, the strategies that you were seeing were probably long-only Bitcoin or, you know, top five currencies or something like that. And you still do see those funds as well and those strategies, but really now just seeing the broad spectrum of strategies tokens putting VC in the same fund; DeFi.”

Speaking on the same topic, Magnus Graham added “ if total digital crypto assets are at $2 trillion and they were at $3 trillion at some point last year and I don't know whether they're going to go back through $1 trillion before they get to $5 trillion, but I do know that the makeup of the market is going to change quite quickly.”

“So if we look at the makeup now, what 2021, $30-odd billion of VC capital came into the market, maybe there's $40, $50 billion of VC sort of money in there.” 

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This is a segment taken from our panel discussion at BEQUANT’s Crypto Capital Introduction Event 2022. Click to watch the full video below.

Kez Duxbury May 30, 2022

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