This publication talks to the founder and CEO of a fintech firm based in the UK that says it is bringing the savvy and insights of investment banking and fund management into the world of bitcoin and other digital assets.
There’s never a dull moment with bitcoin. Surging more than tenfold in price over the past year to more than $64,000 per coin last week, the US stock listing of Coinbase proved a success and added to a busy period for IPOs. But then the digital currency slumped by almost 15 per cent yesterday. Reports said the slide appeared to be hit by reports that the US Treasury is planning to deal with financial institutions which have used cryptos for money laundering.
When there’s such tumult in what is still a relatively young market, the emotional tug-of-war between greed and fear is unusually acute (remember how it felt during the 1990s dotcom era?). A person who is intrigued by digital assets but who doesn’t want to stare at a computer screen all day might prefer to give his or her risk tolerances to an expert manager and let the latter press the buttons. And this is where a business such as UK-based SupraFin comes in.
Founded by Liliana Reasor, an investment and risk management veteran working for bulge bracket banks such as Morgan Stanley, Bank of America, Deutsche Bank and JP Morgan, SupraFin is a platform through which investment managers can oversee an estimated universe of more than 3,000 cryptocurrencies. Clients who sign up are encouraged to hold a diversified portfolio and rebalance it when large price movements shift the asset allocation. This is textbook money management discipline. Clients pay an upfront platform fee, based on the size of the portfolio, and can invest from as little as £300 ($415). There are no liquidity constraints and redemption notice requirements, Reasor told this news service in an interview.
Reasor was blunt about the risks involved.
“The major risk is choosing cryptocurrencies that won’t make it. Another major risk is market risk as market volatility of some cryptocurrencies range from 25 per cent to 250 per cent daily annualised volatility,” she said.
“We need a platform to help people navigate this space because there are more than 3,000 cryptocurrencies currently trading.”
The SupraFin platform held its soft launch in November last year and Reasor said she has been approached by UK independent financial advisors and private wealth managers. The platform can be white-labelled or offered through APIs for advisors, private wealth mangers, or digital platforms, she said. The business arrives at a time when large institutions such as JP Morgan, Julius Baer, BNY Mellon, Goldman Sachs and Guggenheim Partners are pushing into the space.
Specialist crypto investment houses such as Nickel Digital Asset Management argue that, if handled with discipline, digital assets…