As we mentioned in previous communications, we were shocked to learn of the FTX situation and the fraud behind this major player.
As our CEO mentioned in a communication last week, the values of transparency and trust are at the heart of CoinShares’ DNA. CoinShares is Europe’s leading digital asset investment company. From the outset, our goal has been to be accountable and transparent to the market and our clients, which is why we have decided to become a public company listed on Nasdaq from 2020. Without trust, our industry will never develop as it should. This is one of the fundamental principles behind bitcoin and crypto more broadly that we have embraced completely. With this in mind we were among the firsts to publicly disclose our losses from the FTX bankruptcy. The financial health of the Group remains strong and losses are limited to our proprietary trading portfolio (segregated from our products). As recently announced in the our recent earnings results, CoinShares’ net asset value as at 30 September 2022 stood at £240.6M.
HAL.trading is a CoinShares product, therefore it must bear all its attributes: trust, transparency and professionalism. Last week, the HAL.trading team communicated via email to active users on FTX and also took the decision to cut off clients’ crypto exposure to avoid them being at the mercy of market manipulation on FTX. Similarly, we communicated last Saturday to express our dismay and communicate to our users the future actions we intend to carry out so that the value proposition of HAL remains intact. The HAL.trading team is made up of investment professionals with decades of experience in both the traditional financial and the digital asset sector. We aim to act as a compass to all new entrants to the market by educating investors and giving them the best possible tools to make the right investment decisions.
Furthermore, we have never believed in the industry’s promise of free “yield” (as opposed to staking, which plays a role in securing blockchains), because as the saying goes: “If you don’t understand the Yield, then You are the Yield”. This is why HAL.trading offers directional strategies designed by professional quants, as this is what we believe to be a suitable tool for exposure on this new and highly volatile asset class. In the same vein, we have avoided including strategies on illiquid altcoins despite many clients’ requests. We will continue to improve the product first by adding new strategies currently being backtested, by improving the user experience and finally, of course, by integrating new exchange platforms that allow the use of long/short strategies (our Pulse, AI and Dynamic strategies). The FTX crisis raises questions about the financial health of exchanges and their corporate governance. To integrate new platforms on HAL.trading, we will take into account all the factors that constitute elements of reassurance such as proof of reserve, regulation, corporate governance and whether the exchange is listed or not on a stock exchange.
Finally, as you may have read, 3Commas and Skyrex, two platforms that offer trading bots, have been compromised, with some users having their API keys used by attackers to pump certain crypto assets on Binance. We would like to reassure you that our team of engineers is doing everything possible to avoid such inconveniences for our users with institutional-grade security of API keys.
These are challenging times for the digital asset industry, and we believe that by getting back to the fundamentals of the industry: transparency and trust, we will rebuild the industry as it should be.
The HAL.trading team
Disclaimer
Investing involves risk, including the possible loss of all the money you invest. In particular, crypto-assets are a highly volatile and speculative asset class. HAL is only suitable for traders who are willing to bear the risk of loss and experience sharp drawdowns. Past performance is not necessarily a guide to future performance. The performances presented are real performances calculated net of execution fees and slippage from a proprietary Binance account.
The purpose of this material is to provide objective, educational and interesting commentary and analysis on developments in the crypto-assets sector. Nothing in this material should be interpreted as constituting an offer of (or any solicitation in connection with) any investment products or services by any member of the CoinShares Group where it may be illegal to do so. Access to any investment products or services of the CoinShares Group is in all cases subject to the applicable laws and regulations relating thereto.