What We Learned During Our Digital Assets Week

This newsletter is part of The Assetizer, GenTwo's thought leadership platform.

Hello everyone,

As Assetizer readers well know, my colleague Florian Marty and I held our Structured Products on Digital Assets Summit this week. 

A bit of a tongue twister of a name, the Summit was designed to pick up where Florian’s whitepaper this spring left off. It was an in-depth exploration into what we have been calling the “last mile” of institutional crypto adoption, with the help of experts and practitioners from our GenTwo ecosystem.

We’re working on a full-fledged report on the whole Summit which should be available within a few weeks, so in this post I just want to give you a short overview of what transpired. 

We’ve already uploaded the videos so for anyone interested in learning more now, you can watch the sessions on demand on our YouTube channel.

From Market to Live Product – The Overview

Here’s a quick snapshot of what transpired.

• Session 1, The Opportunity. Patrick Loepfe and Florian Marty kicked things off with the big picture. Patrick gave a plain-language tour of what structured products actually are and why crypto's volatility makes it such a natural fit, and Florian laid out the core thesis for the week: the demand for digital assets is there, it's the supply of good products that's missing, and there's a clean way around the thing holding banks back. We also put two live Bitcoin products on the table to make it real. Video here.

• Session 2, Infrastructure. Roman Wildhaber from Bank Frick walked me through the plumbing. We got into why a structured product on crypto still needs a bank at all, what actually happens from the moment you subscribe to the moment your money is invested, and the gap that opens up in the middle. Roman also showed us xPULSE, Bank Frick's way of closing that gap by moving fiat around the clock. Video here.

• Session 3, The Supply Gap. Florian was back, this time with Gabriele Gentile of Capital Finance and Bravo Company. Florian sized up the global structured products market and where digital assets fit, and Gabriele gave us the view from the front line with clients. His take stuck with me: the demand is there, the block is the advisory community, not the client. He also made a strong case for starting with Bitcoin and nothing else. Video here.

• Session 4, Tokenization. I sat down with Nick Cogswell of Archax for a practitioner's view of a topic everyone talks about and few pin down. Nick cut through what tokenization really does and doesn't do, including the myth that it magically creates liquidity. Then we ran a little role play, with me walking in as an asset manager with a uranium product, to see how a real client conversation actually goes. Video here.

• Session 5, Market Making. Maxime Seiler and Jeremy Dominh from STS Digital gave Florian and I the view from the trading desk, the people who have to price and hold the risk. Maxime explained what it means to be the counterparty on every trade and the flow they see from institutional versus crypto-native clients, and Jeremy took us under the hood of the two live Bitcoin products and who each one is for. Video here.

• Session 6, Case Study. We closed the week with Wei Nee Chew and Damien Loh of Ericsenz Capital in Singapore for our most extensive product dive. Damien walked us through their Bitcoin dual-currency note and its inverse, a neat pair that lets you earn a yield whether you're waiting to buy Bitcoin or already holding it, and showed how the whole thing gets built and comes to market. Wei Nee took a look at the larger market for such products. Thought it was a great, concrete way to end. Video here.

If you attended, I hope you enjoyed it. If not, I hope these videos can be interesting for you. And do keep an eye out for our upcoming report.

Tom Lyons,
GenTwo