Trader who lost over 90% of net worth on FTX raises $450,000 for new fund

Belgium-based quantitative trader Kasper Vandeloock, 23, raised $450,000 for his new fund Musca Capital as he attempts to bounce back from losing the majority of his net worth on collapsed crypto exchange FTX. 

The Luxembourg-based fund is backed by one of the founders of NFT project Hashmask, although Vandeloock declined to specify which one, plus two other unnamed individuals.

Vandeloock, known in the crypto circles partly for his trading acumen but also for his parrot named Kiko, said he has been rebuilding his trading systems for the last two years. With the funds, he plans to work on some automated strategies, mostly directional ones. He will start with trading liquid tokens on centralized exchanges.

Exploiting gaps in the market

Over the last few years, Vandeloock found success with a few key trades. One was with crypto exchange BitMEX, where he managed to place what are called stink bids and stink asks at times when its trading engine would get overloaded and stop working for a few seconds. This enabled him to profit from sudden jumps in the crypto prices as the exchange caught up with live prices.

Another was during the 2019 March meltdown, when Bitcoin dropped to $3,000. At the time, he profited from the large spread between the price of the swap contract on BitMEX and the index price.

Yet after building up a sizable net worth, Vandeloock made the mistake of keeping nearly all of it on FTX, an exchange that he had trusted and had personal connections with. When the exchange collapsed in November 2022, more than 90% of his funds were stuck there. Only bankruptcy proceedings will see any of the funds get returned.

“Not a great thing that I lost all my funds on FTX but it’s a lesson that I learned,” he told The Block, noting that going ahead he plans to look for red flags on exchanges and be more cautious with where he stores his funds. “My approach to calculating the counterparty risks of centralized exchanges has changed a lot.”