The world of cryptocurrency should be doing everything it can to attract institutional investors. With $130 trillion of assets under management worldwide, institutional investors could have a huge positive impact if they moved even a tiny fraction of those funds into crypto, whose market cap remains under $300 billion.
Yet diving into the world of crypto can be incredibly daunting. On top of understanding the workings of the underlying technology, newcomers wishing to trade need to adapt to an incredibly volatile market and learn the ropes across a handful of exchanges. Many struggle to reconcile the fragmentation of these platforms — there’s no one-stop shop, meaning that traders must interact with a plethora of exchanges to acquire the crypto assets they want.
On the institutional front, it’s clear that investors have been struggling. We’ve seen institutional players engaging in practices almost unheard of at that level in traditional markets — managing portfolios through Excel spreadsheets, writing Python scripts to execute trades, and using multiple web interfaces. There are, of course, a couple of exceptions to this rule, but for the vast majority, this rudimentary setup is fast becoming the norm.
Caspian aims to set the bar somewhat higher through a comprehensive solution for asset management. Institutions are able to access a fully-fledged platform worthy of traditional markets. Complete with a suite of tools such as OEMS, PMS and RMS, as well as a number of sophisticated trading algorithms, the Caspian solution integrates with the backend of numerous exchanges so that users can access them from a single intuitive interface.
Institutional players will be seminal in pushing the cryptocurrency market cap to the next level. Tools like Caspian should be of great interest, not only to these entities, but to crypto evangelists and speculators at large — the long-term viability of the space is dependent on increasing investments, but many funds will not enter until more streamlined trading platforms can be offered. The introduction of products such as Caspian will therefore bridge an important gap between incumbent institutions, and the rapidly-evolving crypto space.
Supporting as many exchanges as possible has been our main focus for a number of reasons — the first being arbitrage: there’s a lot of money to be made in leveraging prices discrepancies across exchanges. Another motivation for this is a lack of liquidity on a single exchange when executing high-volume orders. Tying the different platforms together in the same interface makes it much easier to fill orders, by drawing on not one, but several pools. This has the added benefit of spreading risk — many exchanges are unregulated, so Caspian mitigates counterparty risk.
With decades of experience in banking, creating institutional-grade trading software and operating hedge funds, the Caspian team brings together a wealth of talent from around the world. It currently has over 40 engineers working on understanding and interacting with the various different APIs offered by exchanges. It’s an arduous task, due to the lack of widely-accepted standards in the industry, as well as all the different technology and language used for their API connections, but it’s also a necessary one to deliver the sophisticated platform that Caspian aims to roll out, and to bring new investors into crypto.
About The Author
Gerrit Van Wingerden is CTO & Co-founder of Caspian. He has served as Managing Director at Tora for the past 12 years. Prior to that Gerrit managed the development of high volume trading applications and analytical tools for various hedge funds and bulge bracket investment banks. Gerrit holds a B.S. in Computer Science from Stanford University
Caspian is a full-stack cryptoasset management platform tying together the biggest crypto exchanges in a single interface, so as to facilitate investments in crypto instruments for newcomers and veterans alike. The joint venture between heavyweights Tora and Kenetic brings to the table a wealth of experience in asset management, accumulated over decades of building and operating trading platforms and technologies.