Crypto prime broker Bequant is offering separately managed accounts (SMAs) so its institutional clients can manage investment strategies in one place, the company announced Thursday.
SMAs as a financial service have been widely used by asset managers who work for institutional investors such as high-net-worth individuals and mutual funds.
“SMAs provide an independent transparent vehicle for institutional investment,” said Alex Mascioli, Bequant’s head of institutional services. “The infrastructure to provide them was there. Offering them now is basically all about our legal team and being able to formulate the product.”
SMAs give investors a daily view into their accounts versus the monthly statements typically provided by hedge funds.
Stepping back, prime brokers are facilitators for financing and trading for deep-pocketed institutional investors.
While the digital asset space doesn’t currently have a lot of prime broker options, several crypto firms including Coinbase, BitGo and Genesis Trading have announced in recent months their plans to build prime brokerage wings.
In a bid to keep its savvy clientele happy, Bequant also added cryptocurrency derivatives trading. The move lets fund managers find market-neutral strategies within those new SMAs, said CEO George Zarya.
Bequant is connected to 11 sources of liquidity currently including HitBTC, Binance, OKEx, Huobi, Bittrex, Bitifnex and Deribit, with plans to add one more by year’s end.
Adding derivatives means the firm has finished integrations with derivatives-only exchanges like Deribit and expanded its use of spot and derivatives exchanges like Binance, Zarya added. The other four sources of liquidity are unnamed over-the-counter (OTC) trading desks.
Bequant also announced Thursday an instant transfer functionality, allowing clients to move funds from one exchange to another in seconds versus the half-hour or so it would take on-chain, Zarya said.
“That allows for more efficient collateral management and more trading opportunities,” he said.