Asset managers are not yet finished with blockchain

Hey fintech family!

Thank you for starting us for another week. Today our main topic is an update of the London asset management correspondent Joshua Oliver about how the sector is still hugging blockchain, and we have an interview with a CEO that helps start-up employees to pay off their shares in the turbulent markets, and win backlaims for some of the largest British fintries.

A note to our readers: This will be one of the last editions in which you will see that Krypto receives a top statement in this newsletter. This is because we started our Cryptofinance newsletter at the beginning of this month, which will be your goal for everything you need to know from the world of digital assets. You can register here.

with Crytofinance running SID and I have more space every Monday to explore other trends that drive the change in the fintech. Expect the new version of Fintecht this autumn. Which fintech topics do you want to treat with the relaunch?

Share your ideas at Imani.moise@ft.com and sid.v@ft.com with.

Happy reading!

Wealth managers consider the candle for blockchain high

Since the cryptocurrency markets were unable to get profits back last week, the asset manager Schroders acquired a participation in the cryptofocussed fund manager forteus. The step underlines the different bets on the future of the investment management sector.

Peter Harrison, Chief Executive of the asset manager listed in the FTSE 100, the assets of 731 billion

"We saw top investment funds," he said in an interview.

So far, the mainstream finance service industry has been spared the effects of the slaughter on the cryptoma markets. However, the blow for the fund managers by failures such as the collapse of the StableCoin Luna in May to the recent bankruptcy of the lender Celsius must still be determined.

"There was very little self-regulation. There was a silly risk management in which the company used massive external financing and asset-liatability abnormal conditions.

Anthony Scaramucci, the investment manager who was notorious for eleven days as Donald Trump's communication director is the last one affected by the decline in crypto prices. His hedge fund SkyBridge Capital "temporarily" stopped the possibility of customers to withdraw money from one of his funds, which is 18 percent invested in crypto and has fallen by 30 percent this year.

scaramucci remains optimistic about crypto in the long term. "I'm not smart enough to take the market," he said to the New York Times last week. "But we have researched a lot and we believe that everyone who has done will recognize that blockchain technology is good and represents the future."

The problems of Skybridge are the youngest in a number of fluctuations and disasters that search for the digital asset sector, but according to industry insiders, the full effects of the crisis on crypto start-ups and investors are not yet felt.

"I think many hedge funds are out of business and they don't know it yet," said Novogratz. He predicts that the number of crypto hedge funds, which has risen from 400 to 1,400 in the past two years, may return to where it came from.

"It is damn frustrating because the whole industry looked like a bunch of idiots at times," added the financier, who was tattooed five months before the Lunas Logo crypto project.

There are signs that investors begin to cool the sector as well as the currencies themselves. According to the dealroom data, the global agency for blockchain startups in May and June was roughly the same as in the previous year. One week before the end in July, the amount of $ 821 million fell by 75 percent compared to 2021.

Nevertheless, the unrestricted booster of crypto have continued to advertise the transformative ability of the underlying technology, even if they start looking for the mistakes that have led to the crash.

"Blockchain technology will help enable access to exciting, more tangible assets," Harrison von Schroders wrote in a letter to the FT. "The question is whether the industry can accept this challenge."

Sam Bankman-Fried, Chief Executive from FTX, said that investors are still interested in the aspiring blockchain sector, but they have become more charitable what they are looking for in a crypto start-up. Although profitability has become a "dirty word" among crypto enthusiasts in recent years, Bankman-Fried said that investors are now asking difficult questions about the usefulness of crypto projects.

"If everyone wakes up one day and this thing was gone, would anyone miss it?" he said. (Josua Oliver)

Fascination fintech

give the algos to the guilt The computer -controlled hedge funds based in Washington have so far recorded steep losses this year, since its models could not quickly adapt to changing markets. Most of the so-called "quant" funds were able to make hay out of the wild fluctuations in the markets, but continue to stumble about the suitability of algorithms that are based on historical data for today's uncertain times.

Inflation concerns the cross -border thrust rising interest and the fear of further currency fluctuations led to a flood of money transfers that gave the income of the British fintech Wise a temporary thrust in the last quarter. However, managers warned that a slowdown could follow the bump if the global economy entered a recession.

Star in the black The strategy of British Digitalbank Starling to diversify its business beyond simple private customer business has the potential to pay dividends. The Neobank achieved its first annual profit last week, which was fueled by entering the mortgage market. The company also said that it would attempt to open a bank in Ireland, give up and instead concentrate on its Banking-as-a-Service (BAAS) platform.

Quick-Fire Questions and Answers

Every week we ask the founders of rapidly growing fintech to imagine and explain what they distinguish in an overcrowded industry. Our conversation, easily edited, appears below.

Last week I spoke to Phil Haslett, Chief Strategy Officer and co -founder of Equityzen, why he believes that the stock crisis in the technology sector will influence the future remuneration packages. His company has helped Pre-IPO companies to pay their shares by selling them to institutional and private investors for almost a decade. Although he has only collected $ 7 million since Equityzen was founded in 2013, Haslett says that the asset light model prevented the company from being dependent on external financing.

How did you start? We noticed that many employees worked in private technology companies and spent shares or stock options, but didn't really know much about what their equity was worth. We also realized that there were individuals who wanted to invest in the technology companies that they really believed in, but they were all private. It was really difficult to exhibit a $ 10,000 check to invest in Uber, Docusign or Spotify. So we decided to set up a technology platform to bring investors who wanted access to start-ups to bring together with employees and former employees who kept and wanted to sell them.

What is the revenue model? We calculate the buyers between 3 and 5 percent of the transaction size and the sellers 3 to 5 percent of the transaction size, only when the transaction is completed.

How did the tech router affect the offer on your platform? The average age of a seller on our platform is between 35 and 40 years, so many of them have never actually experienced a downturn in the markets. You only saw how the value of your property has increased, so there was a small sticker shock. But this also faces the fact that many of these sellers are likely to need more cash than ever. We are gradually seeing people who are willing to sell shares to considerable discounts that we have honestly never saw since we founded the company - 40 to 50 percent discount compared to the previous financing round, which may have taken place only eight or six months.

How did this have an impact on demand? Companies still stay private and grow - so this narrative has not changed. But certainly I think that people are a little more conscious of the kind of investments or expenses that they are currently doing, especially in view of the current environment. We are aware that our customers are a mix of small investors and institutions. We are gradually seeing that the demand on the part of the retailer could decrease, but the institutions are still interested in investing in this area, provided the price is correct.