- Market makers are essential to crypto exchanges.
- New firms are rarer than the launch of other crypto businesses, said Infima Capital CEO.
Former employees of Nexo left to start a new market-making company called Infima Capital, according to a pitch deck reviewed by DL News.
Tom Stanev, Nexo’s former head of trading, will lead the new operation.
A spokesperson for Nexo, which is also a crypto lender and exchange, confirmed to DL News that Stanev and a group of former staffers had departed.
Others joining Stanev are Stefan Bonev, a former Nexo director of engineering, and Lora Zlateva, a former Nexo product manager. Infima Capital already has more than 40 employees, per the deck.
Fresh opportunities
Market makers, also called liquidity providers or speed-trading firms, typically generate returns by using algorithms to take advantage of pricing gaps in assets traded among multiple platforms.
A mainstay in stock markets, market makers help facilitate crypto trading by taking the other side of a transaction when users buy or sell tokens on an exchange.
While necessary for the daily operation of exchanges, new market makers don’t pop up as often as, say, a new blockchain or NFT collection.
“It is rarer,” Stanev, the CEO of Infima Capital, told DL News.
Stanev’s planned launch of his market-making firm comes as speed-trading giants Jump Crypto and Jane Street retreat from the industry.
And the firm says the US Securities and Exchange Commission’s recent approval of both spot Bitcoin and Ethereum exchange-traded funds have helped.
“The ETF approval and resolution of some of the biggest legislative actions from the past years have brought a fresh set of opportunities to the market,” read the deck.
A partner
Infima secured a $5 million investment from a partner it didn’t name, per the deck.
Stanev declined to reveal his firm’s backers.
“We have commitments from multiple counterparties, which I will keep confidential for now, due to the fact that we are still in the raising stage and nothing is set in stone,” he said.
The partner will provide a $100 million credit line for market making and “market-neutral strategies” to Infima Capital, according to the deck.
The partner will also route some of its trading volume to the new market maker.
Stanev told DL News that Infima Capital was a “passion project” during his time at Nexo.
His new company plans to trade on more than 10 exchanges post launch and provide liquidity, or front funds, to DeFi protocols.
Ben Weiss is a Dubai Correspondent at DL News. Got a tip? Email him at bweiss@dlnews.com.