Crypto Products: A Comedy of Errors and Innovations! 😂

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Crypto Products: A Comedy of Errors and Innovations! 😂

Ah, the illustrious firm Zerocap, hailing from the sunburnt land of Australia! Since its inception in the year of our Lord 2018, it has been a keen observer of the grand spectacle that is the structured product space. With a flair for OTC dealings, market making, and the delightful chaos of crypto custody, they have truly made a name for themselves! 🎩

Here we find Mark Hiriart, the head of sales, regaling us with tales of how these products are evolving, unveiling a new semi-principal protected product, and sharing the most peculiar requests that have graced his desk. One can only imagine! 😏

Pray, enlighten us about Zerocap!

Ah, Zerocap, the crown jewel of Australia’s digital assets! Established in 2018, they juggle multiple business lines like a jester at court: an OTC desk, market making, and derivatives, all supported by their trusty custody offering. They are a Corporate Authorised Representative of an Australian Financial Services License (AFSL) holder, allowing them to trade financial products with the crème de la crème of investors. Their partnerships with ANZ Bank and the Reserve Bank of Australia are the talk of the town! 🌍

And what of this new product you speak of?

Ah, a partnership with CoinDesk Indices has birthed a semi-principal-protected structure on the CoinDesk 20 Index (CD20). This delightful concoction offers upside exposure while limiting downside risk to a mere 5%! With potential returns of up to 40%, it’s the first of many structured products to come. A veritable feast for the risk-takers! 🍽️

In these tumultuous times, with digital assets rallying like a horse at the races, this medium-risk product is perfectly timed. Who wouldn’t want a slice of that pie? 🥧

What void does this product fill, and for whom is it crafted?

In the realm of digital assets, we lack the established benchmarks that traditional markets boast. If an Australian or a Hong Kong investor seeks U.S. tech exposure, they look to the NASDAQ or QQQ ETF. Alas, in crypto, we are still searching for that golden index! This product is tailored for family offices, high-net-worth individuals, and those who wish to dip their toes into the crypto waters without diving headfirst! 🏊‍♂️

Why the CoinDesk 20 Index, you ask?

Four reasons, dear reader! First, we hold the CoinDesk brand in high esteem. Second, our relationship with Bullish grants us access to futures contracts for hedging. Third, the market is crying out for index products! And lastly, my background in equity derivatives reveals the natural evolution of these products in the crypto sphere. Voilà! 🎉

How are structured products evolving, you wonder?

Historically, two factors have stifled the adoption of structured products: the wild volatility of crypto and the allure of perpetual futures. But fear not! As more players enter the game, the demand for structured solutions is on the rise. Venture funds and portfolio managers are seeking specific hedging solutions that perpetuals simply cannot provide. A shift is upon us! ⚖️

What of the crypto ETFs and their impact?

ETFs, my friends, are the “gateway drug” to structured products! The arrival of the BlackRock ETF has ushered in new participants, who, once comfortable with crypto, will inevitably seek more sophisticated products. It’s a delightful progression! 🚀

What patterns do you observe in Asia versus other regions?

Asia, with its appetite for auto-call structures, is a different beast compared to the more cautious U.S. and European markets. Having danced with the likes of JP Morgan and Morgan Stanley, I can attest to these regional quirks! Australia, bless its heart, sits somewhere in between, and we at Zerocap are eager to spread our expertise across Asia, regulations permitting! 🌏

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2025-03-19 18:30