London-based Wintermute, a crypto market maker focused on high-frequency algorithmic trading and market-making services, has raised $20M (approx €16.4M) in its Series B round of funding. The round was led by Lightspeed Venture Partners.
“Wintermute has grown almost 25 times since Lightspeed led the company’s Series A round just six months ago,” says Jeremy Liew, partner at Lightspeed. With this investment, Jeremy Liew will join Wintermute’s Board of Directors.
Other investors in this round
Investors in the current round also include Pantera Capital, Sino Global Capital, Kenetic Capital, Rockaway Blockchain Fund, Hack VC, DeFi Alliance, Avon Ventures, a venture capital fund affiliated with FMR LLC, the parent company of Fidelity Investments, and Blockchain.com Ventures.
What does Wintermute do?
The company was founded in 2017 by Evgeny Gaevoy, Harro Mantel, and Yoann Turpin. Wintermute is a global algorithmic liquidity provider for digital assets. It is a crypto-native market maker, focused on building a decentralised financial system by creating efficient, liquid markets with transparent prices.
Market making means providing liquidity on the capital markets to make sure there is enough volume at a reasonable price for investors to buy and sell tokens.
The company mentions in a statement that since its inception, it has become one of the largest liquidity providers in crypto markets, covering thousands of pairs across almost 50 crypto exchanges and trading platforms on CeFi (Centralised Finance), DeFi (Decentralised Finance), and OTC (Over-the-counter).
“Since we have some of the most competitive pricing in the market, we were literally pulled into this business by our counterparties and partners that we work with. The algorithms we use for OTC are the same we use for our proprietary trading, so we have an advantage when it comes to pricing. We take no fees on our OTC activities so counterparties can eliminate intermediaries and cut fees by trading with us directly. With the launch of RFQ we’ll be able to offer OTC trades at a greater scale,” says Evgeny Gaevoy, CEO of Wintermute.
Recent developments
Wintermute says that it has big growth plans for 2021. According to the company, it is piloting its own RFQ (Request for Quote) platform with beta counterparties and is also planning to launch it for institutional players within the first quarter as well as scale the derivatives business. “We have historically focused on spot, but coming from traditional HFTs like Optiver, we have all the expertise in house to provide liquidity in derivatives markets across perpetuals, futures and options,” says Gaevoy.
The company claims to have seen tremendous growth in 2020 growing at a 60 per cent month-on-month and reaching $30B (approx €24.64B) monthly trading volume by December.
Wintermute also provided liquidity for some of the most prominent projects in 2020 and is planning to do the same this year. The company has always operated globally across venues in Asia, the US, and Europe and believes that with the launch of its RFQ and derivatives businesses, it will also expand its physical presence into Asia.
It plans to open its first international office in Singapore in the first quarter of 2021.
Prior to this, the company has raised funding thrice including; a $2.8M (approx €2.2M) in Series A round of funding in July 2020, an undisclosed amount in Seed round funding in Feb 2020, and $1M (approx €821K) also in Seed round in Sep 2018.
