Bitcoin trading shops are hiring Wall Streeters to build out the 'next generation' of cryptocurrency trading
- The market for cryptocurrency is booming, and now trading firms are looking to build out a more mature market infrastructure for the space.
- They will likely set their sights on Wall Street for talent to build out new cryptocurrency trading systems.
Bitcoin trading firms are seeking top talent to build-out the infrastructure for the booming cryptocurrency market. And that talent is likely to come from Wall Street.
DRW's crypto trading division, Cumberland, provides the latest example.
The firm recently brought on Helin Goa, a former swaps trader from Goldman Sachs, according to an email seen by Business Insider sent out to employees of Cumberland by Bobby Cho, head of over-the-counter trading. And the firm is seeking to build out the unit, advertising currently for two different positions: one trader and one developer.
Cumberland, which launched officially in 2014, trades electronically and over-the-counter, receiving calls to execute bitcoin large bitcoin trades in the multi-millions of dollars.
Hehmeyer Trading, a Chicago-based prop trader, is also hiring a developer. According to a LinkedIn ad, the company is looking for someone to "build and maintain trading systems and strategies for use in cryptocurrency markets." A representative from Hehmeyer could not be reached for comment by the time of publication.
DV Chain, the cryptocurrency division of Chicago prop trading firm DV Trading, is another marketmaker in the space. It has been advertising a position for a cryptocurrency software engineer on LinkedIn to help build out the firm's "next-generation" trading platform.
DV Chain's CEO Garrett See told Business Insider he's not necessarily looking for folks with "blockchain" or "crypto" on their CV.
"Middle-office, trading software, trading, order management, traditional programming, are the backgrounds we are looking for in people," See said. Those folks often come from Wall Street, he says.
Applying Wall Street tech to cryptocurrencies
See said the firm is focusing on how it can improve the interface between his trading desks and cryptocurrency exchanges like Coinbase, which lack the capabilities of traditional capital markets players like Nasdaq or the New York Stock Exchange.
"We have been adapting the software we use on the traditional side and applying them to cryptocurrency markets," See said.
See said crypto exchanges work differently and in a sense are still "websites" that lack "the industrial scale" of traditional exchanges. And with cryptocurrency volumes topping as much as $26 million in a single trading day, trading shops are under pressure to enhance their technology.
Josiah Hernandez, the chief strategy office of CoinSource, a maker of bitcoin ATMs, expects these positions to be filled by former Wall Streeters.
"Not many folks from the tech space are able to develop skill sets quickly and hit the ground running as it relates to building markets and providing liquidity," he said. "Fintech and capital markets/[Wall Street] folks usually are though."
Meanwhile, exchanges like Cboe and CME have announced they are preparing bitcoin futures products, which will allow traders to bet on the future price of bitcoin.
The launch of bitcoin futures by establishment firms is likely to to open the door to wider participation in bitcoin trading by other Wall Street firms.
"The CME announcement provides the first step in legitimizing the ever-growing crypto space as a true financial asset," Dave Johnson, the CEO of Latium, a cryptocurrency technology company, told Business Insider. "For market makers this presents access from a known and trusted party into a $94 billion marketplace."
Business Insider previously reported Virtu Financial and DRW are looking to provide liquidity in bitcoin futures markets. Other traders such as Quantlab and Jump Trading are waiting to see how such a market plays out before jumping on the bandwagon, Business Insider previously reported.