RULEMATCH Spot On - All In on Algos

He used to be a rocket scientist in South Africa, but now James Kilroe and his co-founder Geoffrey van Ryneveld run Tendex, a market neutral crypto hedge fund with a focus on medium- and high-frequency trading strategies. Spot On host Ian Simpson and James discussed the background of Tendex's activities in niche crypto markets and its transition to more sophisticated strategies. Along the way, James explained what he thinks of the "financialization" of crypto, the weaknesses with current market infrastructure, market making strategies from TradFi and crypto and how they overlap. (1:05) Intro to a rocket scientist crypto hedge fund manager (3:32) The "financialization" of the crypto market (6:39) The elements coming together for market maturity (7:18) The backstory of Tendex (8:12) Early arbitrage opportunities (8:55) The simple beauty of the crypto market in the early days (10:38) The missing puzzle pieces at the beginning (11:50) From Python script to advance trading venues (12:16) Home-built tech is still the best (14:07) Getting around the fragmentation of unstandardized tech (15:35) Challenges and opportunities of being a market neutral fund in volatile crypto markets (17:22) Overcoming the "flat and the crab" with unique market-making trading strategies (18:19) How Tendex turns tens of millions 10x per day (19:05) Plugging in "slow" strategies to the cutting-edge tech stack (19:40) The decision to go after the biggest, most liquid markets (20:22) The leveling of the market and "time-based" strategies (21:18) Where is the "basis trade" going? (22:18) Why faster venues like RULEMATCH will make a difference (22:28) Why a price discovery venue is needed in Europe (23:18) Cloud-based tech vs bare-metal infra (24:15) The curious thing about latency in crypto trading (25:26) The need for deterministic venues (26:00) What happens when "flows" flow off AWS (26:55) How risk management gets forgotten (27:45) Two lessons from FTX (30:17) How FTX highlighted exchanges playing "bank" (32:02) Handling data and the tech (35:32) The crossover between TradFi and crypto market making approaches (37:44) Trying to determine true price in crypto (38:22) A TradFi strategy that isn't "here yet" (40:31) Post-trade settlement enhancing the role of a prime broker (41:55) How the PB market is changing (42:15) The tricky thing about custodians (43:36) The diverse array of custodial service providers for institutions (46:59) Prime brokers face off against exchanges (49:24) How Tendex is set up with crypto service providers (52:11) Sitting at the heart of Europe (52:25) Understanding crypto investor sentiment and attitudes (55:35) Looking out for stablecoins and digital identity ABOUT THE HOST: Ian Simpson is Director of Marketing and Communication at RULEMATCH as well as host of the RULEMATCH Spot On podcast, focused exclusively on the institutional crypto and digital assets industry. Previously he was Head of Marketing at Bitcoin Suisse and Head of Communications at the Crypto Valley Association. Ian is a veteran of the Swiss crypto and digital assets industry since 2017. His insights on the Swiss crypto and blockchain ecosystem have been featured in CoinDesk, the leader in blockchain news. ------ Disclaimer: The information contained in this podcast about RULEMATCH AG (“RULEMATCH”) and any guest company is for general informational purposes only and should not be considered exhaustive. They do not imply any elements of a contractual relationship nor any offering.