The crypto market has grown exponentially in the last decade, attracting more and more investors who seek to diversify their portfolios and access new opportunities. However, the infrastructure and tools available for professional money managers in crypto are still lagging behind those in traditional finance.

We will explore some of the main challenges and pain points that crypto fund managers face today, and how they can be addressed to improve the trading experience and performance.

One of the biggest challenges for crypto fund managers is the fragmentation and complexity of the market. Unlike traditional finance, where there are centralized exchanges and brokers that offer liquidity, execution, custody, and reporting services, the crypto market is composed of hundreds of different platforms, each with its own protocols, fees, features, and risks.

This means that fund managers have to deal with multiple accounts, interfaces, APIs, and security measures, which increases the operational overhead and reduces efficiency. Moreover, the lack of standardization and regulation in the crypto market creates additional challenges such as price discrepancies, slippage, counterparty risk, and compliance issues.

Another challenge for crypto fund managers is the lack of sophisticated tools and analytics that can help them optimize their trading strategies and performance. While there are some platforms that offer basic features such as portfolio management, order routing, and risk management, they are often limited in scope and functionality.

For instance, most platforms do not support advanced order types such as stop-loss, trailing stop, or conditional orders, which are essential for managing risk and capturing opportunities in a volatile market.

Similarly, most platforms do not provide comprehensive data and insights that can help fund managers analyze their performance, identify trends, patterns, and anomalies, and adjust their strategies accordingly.

To overcome these challenges and improve the trading experience for professional money managers in crypto, there is a need for a platform that can provide a unified and seamless solution that covers all aspects of crypto fund management.

Such a platform should offer:

Access to multiple liquidity sources across different platforms and regions, with competitive fees and execution quality. A secure and reliable custody solution that ensures the safety of funds and assets, with support for multiple wallets and protocols.

A user-friendly and customizable interface that allows fund managers to easily manage their portfolios, orders, positions, and risk exposure. A powerful and flexible order management system that supports various order types and strategies, with smart routing and execution algorithms.

A comprehensive and insightful analytics dashboard that provides real-time data and reports on performance, attribution, risk metrics, benchmarks, and more. A compliant and transparent solution that adheres to the highest standards of regulation and governance in the crypto industry.

By offering such a platform, we aim to bridge the gap between crypto and traditional finance and enable professional money managers to leverage the full potential of the crypto market.

Crypto is one of most innovative and dynamic Consumer Ecosystem

The world of crypto is not only about trading and investing. It is also about creating and participating in a new kind of economy that is powered by decentralized technologies and communities.

Crypto is also the most innovative and dynamic consumer ecosystem in the world, where users can access a variety of products and services that are tailored to their needs and preferences.

Crypto is not just a new way of transferring value or storing wealth. It is a paradigm shift that enables anyone to create, own and participate in decentralized networks that are governed by code and incentives. Crypto is the ultimate expression of individual sovereignty, collective intelligence and network effects.

Crypto is also the most innovative and dynamic consumer ecosystem in the world. There are thousands of projects, protocols and platforms that are constantly evolving, experimenting and competing to offer the best solutions for various use cases and needs. Crypto is a playground for entrepreneurs, developers, investors and users who want to explore the possibilities of a new digital economy.

Some of the benefits of crypto for consumers are:

Crypto enables users to have more control over their own data, identity, and assets. Users can choose how to store, share, and use their information, without relying on intermediaries or centralized platforms that may compromise their privacy or security.

Crypto allows users to access a global market of goods and services, without borders or barriers. Users can transact with anyone, anywhere, anytime, using any currency or token they prefer. Users can also benefit from lower fees, faster transactions, and more transparency.

Crypto empowers users to become creators and contributors, not just consumers. Users can create their own content, products, or services, and monetize them through various platforms and protocols. Users can also join communities that share their interests and values and collaborate on projects or causes that matter to them.

Crypto is not only a technology, but also a culture and a movement. It is a way of thinking and living that challenges the status quo and embraces innovation and diversity. Crypto is also the most innovative and dynamic consumer ecosystem in the world, and it is only getting started.

Crypto is not without its challenges and risks. It is still a nascent and volatile industry that faces regulatory uncertainty, technical complexity and security threats. Crypto is not for everyone and it requires a lot of research, education and due diligence before engaging with it. Crypto is not a get-rich-quick scheme or a magic bullet that will solve all the world’s problems.

But crypto is also an opportunity and a vision. It is an opportunity to create more open, fair and inclusive systems that empower people and communities. It is a vision of a more decentralized, transparent and resilient world that respects individual rights and values collaboration. Crypto is arguably the best and most vibrant consumer ecosystem in the universe. And it is just getting started.

One of the most important concepts in investing is the time value of money. This means that money available today is worth more than the same amount of money in the future, because it can be invested and earn interest or returns. The longer the money is invested, the more it can grow and compound over time.

However, this also implies that any delay or interruption in investing can have a significant opportunity cost. Every second that capital is sitting idle and not earning a return, the more negatively it impacts performance. This is why investors should always seek to minimize cash drag, which is the amount of uninvested cash in a portfolio that reduces the overall return.

Cash drag is the negative impact of holding cash in an investment portfolio. It occurs when the return on cash is lower than the return on the rest of the portfolio, reducing the overall performance. Cash drag can be a significant drag on long-term returns, especially in periods of high inflation or low interest rates.

Cash drag can occur for various reasons, such as holding cash for liquidity needs, waiting for better market conditions, or simply being unable to find attractive investment opportunities. While some cash drag may be unavoidable or even desirable in certain situations, it should always be monitored and managed carefully to avoid eroding the long-term performance of a portfolio.

There are several ways to measure cash drag, depending on the type of portfolio and the benchmark used. One common method is to compare the portfolio’s return with the return of a similar portfolio that is fully invested, without any cash allocation.

The difference between the two returns is the cash drag. Another method is to compare the portfolio’s return with the return of a market index that represents the portfolio’s asset allocation. The difference between the two returns is the cash drag plus any active management fees or expenses.

Cash drag can be reduced by minimizing the amount of cash held in the portfolio, or by investing the cash in higher-yielding assets that are consistent with the portfolio’s risk and return objectives.

For example, an investor can use a sweep account that automatically transfers excess cash into a money market fund or a short-term bond fund. Alternatively, an investor can use a margin account that allows borrowing against the securities in the portfolio, reducing the need to hold cash for liquidity purposes.

Reducing cash drag can enhance the portfolio’s long-term returns, but it also involves some benefits and risks. The benefits include:

Higher compounding effect: By reinvesting the cash into higher-returning assets, the investor can benefit from the power of compounding over time, increasing the portfolio’s value.

Lower opportunity cost: By avoiding holding cash when the market is rising, the investor can capture more of the market’s upside potential, reducing the opportunity cost of missing out on gains.

Lower tax liability: By holding less cash, the investor can reduce the tax liability from interest income, which is typically taxed at a higher rate than capital gains or dividends.

The risks include:

Higher volatility: By holding less cash, the investor can increase the portfolio’s exposure to market fluctuations, increasing its volatility and downside risk.

Lower liquidity: By holding less cash, the investor can reduce the portfolio’s ability to meet short-term cash needs, such as withdrawals, rebalancing, or margin calls.

Higher borrowing cost: By using a margin account, the investor can incur interest charges and fees for borrowing against the securities in the portfolio, increasing the portfolio’s expenses and reducing its net return.

Cash drag is an important factor to consider when managing an investment portfolio. By measuring and reducing cash drag, an investor can improve the portfolio’s efficiency and performance.

However, this also involves trade-offs between risk and return, liquidity and opportunity cost, and tax and borrowing implications. Therefore, an investor should carefully assess their goals, time horizon, risk tolerance, and cash flow needs before making any changes to their cash allocation.

Cash is the ultimate top-of-funnel, and regulation is the ultimate lock-in. What does this mean for your business? In this blog post, we will explore how these two factors can shape your strategy and help you achieve your goals.

Cash is the ultimate top-of-funnel because it attracts customers who are looking for a solution to their problem. Cash can be used to offer incentives, discounts, rewards, or free trials that entice potential customers to try your product or service. Cash can also be used to invest in marketing, branding, or customer acquisition that increase your visibility and awareness in the market. Cash is the fuel that drives your growth and expansion.

Regulation is the ultimate lock-in because it creates barriers to entry and exit for your competitors and customers. Regulation can be used to protect your market share, differentiate your offering, or create switching costs that make it hard for customers to leave you.

Regulation can also be used to influence the rules of the game, shape the industry standards, or lobby for favorable policies that benefit your business. Regulation is the shield that defends your position and advantage.

One of the most powerful ways to create a competitive advantage in your market is to use regulation as a strategic tool. Regulation can be seen as the ultimate form of lock-in, because it creates barriers to entry and exit for both your competitors and your customers.

Regulation is the set of rules and standards that governs the behavior of actors in a given industry or domain. Regulation can be imposed by governments, industry associations, or self-regulatory bodies. Regulation can have various purposes, such as protecting consumers, ensuring fair competition, promoting social welfare, or enhancing national security.

Regulation can also be used as a strategic tool by businesses to gain an edge over their rivals. By influencing the design and implementation of regulation, businesses can create favorable conditions for themselves and unfavorable ones for their competitors.

For example, businesses can lobby for regulation that raises the costs of entry or compliance for new entrants, or that limits the scope of innovation or differentiation for existing players. Businesses can also use regulation to lock in their customers by creating switching costs or network effects that make it hard for them to switch to alternative providers.

Some examples of how businesses have used regulation as a strategic tool are:

Microsoft used its dominant position in the operating system market to influence the standards and protocols of the internet, making it harder for competitors to offer compatible products and services.

Uber exploited the regulatory gaps and loopholes in the taxi industry to offer a cheaper and more convenient service, disrupting the incumbents and creating a loyal customer base.

Amazon leveraged its scale and efficiency to avoid paying taxes in many jurisdictions, giving it a cost advantage over its competitors and allowing it to reinvest in its growth.

Facebook acquired Instagram and WhatsApp to consolidate its dominance in the social media market, creating network effects that make it difficult for users to switch to other platforms.

These examples show how regulation can be a powerful source of competitive advantage for businesses that know how to use it strategically. However, regulation also comes with risks and challenges. Regulation can be unpredictable, complex, and costly. Regulation can also backfire if it triggers a negative public reaction or invites regulatory scrutiny or retaliation.

Therefore, businesses need to be careful and smart when using regulation as a strategic tool. They need to understand the regulatory environment they operate in, anticipate the potential impacts of regulation on their business model and value proposition, and engage with regulators and stakeholders in a proactive and constructive way.

Regulation is the ultimate form of lock-in because it creates barriers to entry and exit for both your competitors and your customers. By using regulation as a strategic tool, businesses can create a competitive advantage in their market and increase their profitability and sustainability.

However, regulation also comes with risks and challenges that require careful and smart management. Businesses that want to use regulation as a strategic tool need to have a clear vision, a strong strategy, and a good relationship with regulators and stakeholders.

Cash and regulation are two powerful tools that you can use to build a successful business. However, they are not mutually exclusive. You need both cash and regulation to create a sustainable competitive advantage.

Cash helps you attract and acquire customers, while regulation helps you retain and satisfy them. Cash helps you innovate and disrupt, while regulation helps you consolidate and dominate. Cash and regulation are complementary forces that work together to create value for your business.

Can you defend your June 2023 prediction on Naira, post-floating? Yes, what was your prediction when Nigeria floated the Naira in June 2023? Here are samples.

“The Fund greatly welcomes the authorities’ decision to introduce a unified market-reflective exchange rate regime in line with our long-standing recommendations. We stand ready to support the new administration in its implementation of FX reforms.” – IMF.

“While it will take a few days for USD/NGN spot to settle, we fully expect an initial overshoot towards the parallel market rate of -750 or higher, after which, we expect USD/NGN to settle in the high 600s over [the] coming months.” – JP Morgan.

“our analysis suggested that at current oil prices, the naira adjustment needed to rebalance the current account into a sustainable surplus would entail a devaluation to around NGN 750 vs. the USD.” – Goldman Sachs.

“Nigeria’s floating of its currency, while progressive, will cause severe perturbations in the economy – and a stable state may not come as most experts have predicted.”  – Ndubuisi Ekekwe.

It’s Beyond Floating Naira, Nigeria Must FLOAT Industries To Stabilize Naira

Naira is hitting N1,600/$ and a stable state is still far because Nigeria cannot float Naira without the pillars to hold Naira. Those pillars are factories and warehouses (the old and the modern).

According to ChatGPT, a village boy named Ndubuisi, was closer to its prediction than most experts. It went further, positing that Nigeria widened the gap, instead of closing the black and official rates: “According to Tekedia, the unstable state of the Naira is more dangerous to the economy than a mismatch in pricing between official and black market currency rates. Tekedia also says that the Naira floating did not close, making the core reason for the floating largely unrealized”

Can you defend your June 2023 prediction on Naira, post-floating? Yes, what was your prediction when Nigeria floated the Naira in June 2023? Here are samples.

“The Fund greatly welcomes the authorities’ decision to introduce a unified market-reflective exchange rate regime in… pic.twitter.com/oF7kAJLyQX

— Ndubuisi Ekekwe (@ndekekwe) February 17, 2024

Comment on Feed

Comment 1: “If CBN Governor can stop Nigerians from saving money in dollars and open Nigeria bank card for international transaction, Naira depreciating everyday will stop automatically, but since it won’t favour the Elite, they won’t do it. But one thing it sure, as the masses are crying everyday, so shall everyday making the elite happy shall continue to depreciate everyday.”

My Response:   ‘If CBN Governor can stop Nigerians from saving money in dollars and open Nigeria bank card for international transaction,” People who make this point do not spend time looking at data. Over more than 3 decades we may have had dorm accounts, Nigerians and their companies have saved/kept $30b on moving average. If you run the numbers, less than $2B is saved/kept in dorm accounts per year. Assume there are no dorm accounts, $2b will not handle Nigeria’s balance of payment for two weeks. Nigeria’s import was close to $70 billion in 2023.

Rather, the dorm accounts are FREE funds Nigerians are using to defend our banks, making it possible for them to be accepted for correspondent banking globally. If Nigeria has great political leaders with business sense, the dorm accounts should be seen as POSITIVES because nations will savings get benefits.

Dorm is not our problem. Send this response to those attacking the dorm. I can speak with more data to show that dorms are irrelevant. Our problem is clear: we do not produce anything for export except oil.