Here's how the crypto market shifted last year, according to an exec trading billions of dollars

Episode 8 of Season 4 of The Scoop was recorded remotely with The Block’s Frank Chaparro and Joshua Lim, Head of Derivatives at Genesis Global Trading.

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2021 was a landmark year for Genesis Global.

The trading firm — which operates a wide-range of businesses spanning lending and prime services — clocked in more than $100 billion in spot crypto volumes in 2021. On the lending side of the house, cumulative loan originations stood at more than $130 billion.

On this episode of The Scoop, head of derivatives at Genesis Joshua Lim helped unpack the dynamics shaping the market behind its headline Q4 numbers.

In addition to a compression in the popular, and once very juicy, basis trade, Lim explained that the market became more dynamic with big new hedge funds entering the fold. At the same time, existing participants become more engaged with the market – holding crypto on their balance sheet for not just investment purposes, but for operational use as well.

“It could be linked to receiving payments denominated in tokens from projects that they had executed for other firms. It could be related to running nodes on a blockchain,” Lim said. “It could be more traditional kind of crypto native use cases like receiving a percentage of whatever assets under custody as sort of a revenue stream.”

“We saw those types of firms really engaging on derivative hedges that would, you know, protect them on the downside, which was actually kind of useful.”


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Lim added that as more firms enter the space through the metaverse and non-fungible tokens (NFTs), demand for such hedging tools could extend beyond the crypto native investors that Genesis is used to dealing with. The firm has already started accepting NFTs as collateral for certain loans. Still, it’s early days for NFT-related lending.

“It's not something that we do on a regular basis,” Lim said. “I think from a business perspective, it's still, let's say, less than 50 basis points of our overall lending business in terms of the magnitude of the collateral value."

On this episode, Lim and The Block’s Frank Chaparro also discuss:

  • How volatility has changed in the crypto market'
  • The impact new, esoteric structure products could have on crypto market structure
  • Why traders are looking for stablecoin insurance
  • What Lim looks for when he’s hiring new traders to the desk

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

About Author

Frank Chaparro is Host of The Scoop podcast and Director of Special Projects. He also writes a biweekly newsletter. Chaparro started his career at Business Insider, where he specialized in the intersection of digital assets and Wall Street, market structure, and financial technology. Soon after joining Business Insider out of Fordham University, Chaparro was interviewing top finance and tech executives, including billionaire Mark Cuban, “Flash Boys” star Brad Katsuyama, Cboe Global Markets CEO Ed Tilly, and New York Stock Exchange President Tom Farley. In 2018, he become a sought after reporter in the crypto world, interviewing luminaries such as Tyler Winklevoss, the cofounder of Gemini, Jeremy Allaire, the CEO of Circle, and Fundstrat head Tom Lee. For inquiries or tips, email [email protected].