Tag: Market Makers

DWF Labs Co-founder Andrei Grachev Announces Financial Partnership with DMCC

by Blockchain News

On October 8, 2023, Andrei Grachev, the co-founder of DWF Labs, divulged a significant partnership between his firm and the Dubai Multi Commodities Centre (DMCC) via Twitter. This alliance is poised to enhance the financial ecosystem within DMCC, as DWF Labs commits to aiding entities keen on transitioning their operations to Dubai. Nonetheless, this positive development unfolds amidst recent controversies surrounding Grachev and other market players, which have ignited discussions within the crypto community.

Grachev’s tweet stated, “We are licensed by @DMCCAuthority and we are proud to be a financial partner of its ecosystem! If you build and want to move to Dubai DMCC > just reach @DWFLabs, we support our portfolio without any charges. Just build ✊.” This message, attracting over 13,000 views, distinctly signals the financial backing DWF Labs is offering to firms aspiring to establish or migrate their operations to Dubai DMCC.

Prior to this announcement, on September 21, 2023, a Twitter altercation broke out between Grachev and Cristian Gil of GSR.io. The discord centered on a panel discussion featuring representatives from GSR.io, OKX, and Wintermute, with Grachev countering Gil’s critique by affirming DWF Labs’ superiority in tech, trading, and business development. This exchange underscored the prevailing competitive dynamics and potential latent tensions within the crypto market.

The feud captured the attention of other Twitter users, inciting discussions about the current state of the crypto market and the pivotal role of market makers. A whimsical suggestion of a “Crypto Fight Night” between Grachev and Gil by a user named Mohammad (@Abu9ala7) further accentuated the community’s engagement and the competitive ethos within the crypto sphere.

The contrasting scenes of a significant financial partnership announcement and a public disagreement with a market peer exhibit the multifaceted dynamics DWF Labs navigates in the crypto market. The amalgam of cooperation, competition, and community engagement mirrors the complex terrain that market players like DWF Labs traverse as they endeavor to fortify their positions in the swiftly evolving crypto industry.

Though DWF is broadening its presence and influence in the crypto realm, its role remains quite controversial.

The altercation with Cristian Gil, along with the ensuing discussions around market makers and a playful proposal for a “Crypto Fight Night,” emphasizes the fervent engagement and the spirited competition within the crypto domain, reflecting the ever-vibrant and dynamic nature of this burgeoning industry.

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Five Market Makers Nearing Worldcoin (WLD) Loan Settlement Date

by Blockchain News

In July, according to EmberCN, when Worldcoin (WLD) launched, it lent a collective sum of 100 million WLD to five market makers to enhance liquidity. According to the terms, these market makers must either return the coins or buy them at a price ranging between $2 to $3.12 by the conclusion of a three-month term, which is slated for October 22. With the date less than a month away, a close examination of the recent on-chain activities and the current WLD holding statuses of these market makers unveils notable insights.

Wintermute

Initially allocated 28 million WLD, Wintermute now holds 14.16 million WLD on-chain. In the recent fortnight, there has been a retrieval of 1.93 million WLD from Binance. This reflects a possible preparation towards fulfilling the loan settlement terms. The retrieval also suggests a level of activity that might be aimed at either returning the borrowed sum or purchasing them as per the agreed price range.

Amber Group

Amber Group started with an allocation of 24 million WLD, but its current on-chain holdings have dwindled to 4.5 million WLD. In July, a hefty sum of 19.5 million WLD was transferred to various centralized exchanges (CEX), with no recent retrievals noted from these platforms. The large transfer to exchanges could have been a move to take advantage of possible higher market prices, but the lack of recent retrievals from CEX might raise queries on their strategy towards the upcoming settlement deadline.

Flow Traders

Similar to Amber Group, Flow Traders was allocated 24 million WLD. They now hold 8.5 million WLD on-chain. Noteworthy is their recent activity where they retrieved 2.45 million WLD from multiple CEX in the last two weeks. This activity could be perceived as a step towards amassing the necessary WLD for either return or purchase as per the loan agreement.

Auros Global

With an initial allocation of 12 million WLD, Auros Global’s on-chain holdings have significantly reduced to 0.5 million WLD. They transferred 11.5 million WLD to various CEX in July, with no recent activity of retrievals from these platforms. The substantial reduction in on-chain holdings and the absence of recent retrievals may prompt questions regarding their strategy as the loan settlement date approaches.

The observed data exhibits a range of strategies among the market makers as the loan settlement deadline looms. Some market makers have initiated retrievals from exchanges, possibly in preparation for the return or purchase of the borrowed WLD, while others have not shown such movements. These actions are critical for WLD stakeholders to monitor as they could potentially impact the market dynamics of Worldcoin.

The unfolding scenario presents a significant juncture for Worldcoin and its market makers. The actions of these market makers could either fortify or challenge the market stability of WLD, especially as the settlement date nears. The anticipation builds among the WLD community and the crypto market at large as to how these market makers will act – whether they will return the borrowed WLD or opt to purchase them, and how such actions would subsequently affect the market dynamics of Worldcoin.

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DWF Labs’ Andrei Grachev Fires Back at GSR Cristian Gil

by Blockchain News

Key Takeaways

Andrei Grachev, head of DWF Labs, and Cristian Gil of GSR.io engage in a public Twitter feud.

The exchange has led to discussions about the state of the crypto market and the role of market makers.

A Twitter user suggests a “Crypto Fight Night” where the loser quits the crypto markets.

The Twitter War

On September 21, 2023, a Twitter feud erupted between Andrei Grachev, the head of DWF Labs, and Cristian Gil of GSR.io. Grachev responded to Gil’s tweet, which criticized his presence on a panel discussion involving GSR.io, OKX, and Wintermute. “I never thought that you could be THAT scared of us. Yeah, we are stronger than you in terms of tech, trading, BD and everything,” Grachev tweeted.

Market Makers and Market Cycles

The exchange drew attention from other Twitter users, including Delta (@deltaxbt), who questioned what this “beef” among market makers indicates about the current stage of the crypto market cycle. Market makers play a crucial role in providing liquidity and facilitating trades in the crypto market, and their public disagreements could signal underlying tensions or shifts in the industry.

The “Crypto Fight Night” Proposition

In a surprising twist, a Twitter user named Mohammad (@Abu9ala7) proposed a “Crypto Fight Night” where Grachev and Gil would face off, and the loser would have to exit the crypto markets. The idea gained traction, with some users suggesting that such an event could set a “historical crypto bottom” before the next market run.

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Bloomberg: FTX Bankruptcy Triggers 30% Profit Margin Drop for Crypto Market Makers

by Blockchain News

According to Bloomberg‘s report dated September 5, 2023, liquidity providers Auros, GSR Markets Ltd., and Wintermute Trading Ltd. have disclosed that the bankruptcy of the FTX exchange has led to a 30% reduction in profit margins for crypto market makers. “The FTX debacle was a wake-up call for the industry,” commented Le Shi, head of trade at Auros.

In the wake of the FTX bankruptcy, market makers are re-evaluating their risk profiles and are advised to diversify their operations and store their digital assets away from trading platforms. Auros further elaborated that using intermediary services for collateral storage contributes to a 20%-30% decline in profitability, compared to leveraging coins directly on a trading site.

Meng Hwee Neo, managing director of trading and Singapore co-head at GSR Markets, told Bloomberg that market makers are increasingly focusing on Bitcoin and Ether in a “flight to quality” strategy. While this shift may result in slimmer profit margins, it offers greater volume and business opportunities.

CCData statistics, as cited by Bloomberg, reveal that monthly spot trading volumes on centralized crypto exchanges have plummeted 74%, dropping to $445 billion in August 2023 from $1.1 trillion in January 2022.

Market-making firms like Jane Street Group and Jump Crypto are retreating from the digital asset market due to low trading volumes, increased volatility, and heightened U.S. regulatory scrutiny on exchanges such as Binance Holdings Ltd. and Coinbase Global Inc.

 The repercussions of FTX’s insolvency extend beyond market makers to encompass nearly all entities in the crypto sector. BlockFi’s CEO, whose company also went bankrupt, previously admitted to disregarding advice from their risk management experts on lending assets to Alameda Research and FTX.

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Lightspeed, Pantera Join $20M Raise for Crypto Market Maker Wintermute

by Coindesk

London-based Wintermute, an algorithmic liquidity provider for digital assets, closed a $20 million Series B led by Lightspeed Venture Partners with participation from Pantera Capital. 

Other investors joining the round include Sino Global Capital, Kenetic Capital, Rockaway Blockchain Fund, Hack VC, DeFi Alliance and Avon Ventures, a venture capital fund affiliated with FMR LLC, the parent company of Fidelity Investments. 

Announced Wednesday, Wintermute plans to use the funding to open its first international office in Singapore in the first quarter of this year, spearheading a general push into Asia, the company said.

The company also plans to launch a derivatives business and offer RFQ or “request-for-quote” services for counterparties, typically used for trading illiquid markets. 

RFQ is basically an automated version of Wintermute’s over-the-counter trading business and something the firm was “literally pulled into” by its counterparties, according to Wintermute COO Marina Gurevich.

“We were doing a lot of OTC transactions with various institutional counterparties and many of them were asking us to offer RFQ so they could trade more with us,” Gurevich said via email. “With institutional demand for OTC growing in December, we’ve seen demand accelerate, so we were doing pilots and are launching Beta RFQ now.”

Founded in 2017, Wintermute provides liquidity on more than 500 spot trading pairs, on dYdX perpetual swaps and a handful of crypto exchange-traded products (ETPs) from 21Shares. As well as centralized exchanges and OTC, Wintermute is focused on the burgeoning world of decentralized finance (DeFi).

Gurevich said Wintermute will look to provide liquidity to decentralized exchanges (DEXs) that the firm believes in, even if their volumes are low. 

“We work with many DeFi projects supporting liquidity of their tokens on CeFi exchanges. We don’t charge fees and we partner with the projects we believe can have an impact long-term,” Gurevich said. “We help projects start AMMs [automated market makers] and support liquidity there. We work with DEX aggregators to provide liquidity directly and this is what we believe will grow in future.”

Back in July 2020, Wintermute raised $2.8 million in funding from Lightspeed. Over the course of last year, the company said it has seen explosive trading volumes, growing at a 60% monthly rate and reaching $30 billion monthly trading volume by December.

As part of today’s announcement, Jeremy Liew, partner at Lightspeed, will join Wintermute’s board of directors.

“Wintermute has grown almost 25x since we led the Series A round just six months ago,” Liew said in a press statement. “That rarely happens.” 

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