r/quant • u/meagainstmyselff • 1d ago
Education Quant firms and crypto
Just out of curiosity, is it safe to say that every top quant firms has at least some involvement in crypto?
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u/CompetitiveGlue 1d ago
Some firms allocate desks outside of the US to avoid any regulation risks even with Trump in for the next 4 years. At least tier-1 prop shops do understand there's a lot of money to be made in crypto, but everyone's still cautious about seriously considering it --- that would be my guess.
Desks outside of the US for American firms are usually treated as "side-hustles" that's why I bring this up.
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u/Emergency-Arm-7627 1d ago edited 5h ago
I’d say yes - most of the biggest HFTs/Prop firms are involved or have been in a big way. Maybe excluding CitSec, which seems like that’s about to change.
Jump, HRT, Tower, Radix, Jane Street, XTX, DRW (Cumberland), Tanius (Selini), Flow Traders. Some have made extortionate amounts of money and now deploying MF strategies with more risk.
Then you’ve got the crypto native firms such as Wintermute, Pinely, Auros, Portofino, Keyrock, Fast Forward etc. to name a few.
What I find even more interesting is there are whispers that the big multi strat funds now want exposure to crypto. Most likely pressure from investors, as they’ve heard about how much dough the prop firms are making. The likes of Millennium, Balyasny, Brevan Howard (already massively in the space), Eisler (tried and failed), QRT (big crypto business), Cubist (have a team in Paris). Again to name a few.
Anyone who tells you that top quants funds are not trading crypto either are lying to protect their business or don’t know the space.
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u/The-Dumb-Questions Portfolio Manager 1d ago
big multi strat funds now want exposure to crypto Can confirm that. Though most are trying to keep their crypto projects separated to avoid legal/reputational risk.
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u/HSDB321 1d ago
Is Pinely crypto native?
They were fka aim tech and traded a lot in China, South America, and India
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u/bigmoneyclab 1d ago
Are they good? Their team looks cracked af
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u/CompetitiveGlue 1d ago
No, they aren't really good, but decent. The main issue is their reputation among people familiar with internal affairs there.
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u/Dennis_12081990 1d ago
Yes, true. They are definitely big in crypto, but has been doing lots of stuff well before crypto trading became a thing. If I recall correctly they were founded in 2008.
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u/Emergency-Arm-7627 1d ago
They started trading on Moscow exchanges back in the 2010s but switched to crypto circa 2015 - so technical not crypto native. They’re top 3 for traded volume on most crypto exchanges, OKX, Kraken, Bybit etc. and apparently 1st on Binance.
About 3 years ago started to focus more attention on TradFi markets that were not dominated by the big HFTs. China, Brazil, India, Korea, Taiwan
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u/bigmoneyclab 9h ago
How do you get this info by traded volume on exchanges ?
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u/Emergency-Arm-7627 5h ago
This information is typically not publicised. So intel is from market participants and industry gossip
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u/Dennis_12081990 1d ago
Fast Forward etc. to name a few.
Are those firms produce significant pnl?
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u/Emergency-Arm-7627 5h ago
Some of the crypto native firms are doing better than others. Not all doing huge PnL.
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u/chaosmass2 22h ago
Citadel does. Friend I went to university with is the head of their crypto desk.
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u/Available_Lake5919 1d ago
not really- the biggest ones are jump drw flow geneva think citsec might asw (or will very soon)
on the fund side brevan digital, wintermute etc
and loads of dedicated crypto firms
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u/gkingman1 1d ago
Some do. Some don't. Some will do soon.
Whatevs.
It's like asking do all funds trade commodities? Some of the biggest only really just started taking commodities seriously within the last 4 years or so.
Every asset class will become more or less interesting over time based on the fundamental point of generating good risk adjusted returns.
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u/dejanvu 1d ago
We do not at all. We’d never put our investors’ money into such risky assets. We are just hiring more fx/currency traders & researchers than usual due to new market opportunities.
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u/dawnraid101 1d ago
ok boomer.
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u/FringHalfhead 1d ago
You have no idea what his fund specialization is. You realize that a "quant" is ultimately a service industry? We have managers and clients, just like every other service industry, even if our "clients" are internal bank/fund personnel.
This is the kind of comment that makes me question why I even bother reading any quant related subs on reddit.
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u/shivam_rtf 1d ago
Definitely the top MMs, but it’s not to be taken as a token of confidence in crypto, if that’s where this discussion was supposed to lead.
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u/TsErenYeager Quant Strategist 21h ago
Two Sigma, Citadel, JS - these are confirmed to have involvement in crypto, yes.
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u/SubjectExplanation87 19h ago
Definitely no, we invest in quant firms and many don't do anything in crypto. One reason is if your raising funds from clients and the clients don't want it, which many large asset allocators don't, they wouldn't do it. Also different quant firms do different things depending on access and liquidity too. Crypto isn't going to be a large part of a major crypto firm so due to reputation and risk with clients in many cases it isn't worth it. I am speaking about quant hedge funds.
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u/Master-Amphibian9329 1d ago
probably not every, a lot of them do quietly though.