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This week on The Bit, we’re joined by Evgeny Gaevoy, the Founder and CEO of Wintermute, a leading global algorithmic market maker in digital assets that creates liquid and efficient markets on centralized and decentralized trading platforms and off-exchange.

Evgeny and Stephen touch upon everything from Wintermute’s origins to the reasons why regulation is so critical when it comes to growing in the crypto space.

Here are the show notes:

[01:25] From Amsterdam to London 

[11:24] The Next Big Thing 

[19:02] Global Domination

[22:16] Ignoring Regulations 

Stephen: Hi, and welcome to The Bit, the Bittrex Global podcast, where we give you the inside scoop on all things crypto. I’m Stephen Stonberg, the CEO of Bittrex Global. 

Welcome to today’s episode of The Bit, where we sit down with some of the hottest names in crypto to give you an insider’s perspective on the fast-moving world of cryptocurrency. 

When you think of where the crypto space is today, most people think it consists of traders, exchanges, and funds. But there’s a lot more to it than that, with the crypto ecosystem incorporating many of the same tools and concepts from traditional finance, including market makers. 

Interestingly enough, the term market maker not only includes makers that specialize in OTC, dark pools, and execution services but also in high-frequency trading firms that operate as proprietary trading companies and leverage their algorithms or algos to create an easy way to convert crypto into fiat. 

Based and founded in London, Wintermute is quickly becoming one of the go-to names in the space for high-frequency crypto trading. So to help us get a better grip on Wintermute and high-frequency trading, how it works, and where the broader space is heading with some of the new products that are arriving on the scene, I’m speaking today with Evgeny Gaevoy, the Co-Founder and CEO of Wintermute. 

Welcome to The Bit. I’m excited to be chatting with you today. 

Evgeny: Likewise, thanks for having me. 

[01:25] From Amsterdam to London

Stephen: It’s been great working with your firm. We’re learning more about Wintermute and its market-making functions along with some of the innovative directions the company is moving towards. 

But before we dig into that, I always ask guests this question. And I wanted to ask you who or what got you into crypto in the first place? And how did you hear about it? And how and when did you buy your first Bitcoin?

Evgeny: How I got my first Bitcoin is a really embarrassing question because I did it pretty late in 2017. I think I was one of those people who were much more into blockchain, not Bitcoin. That’s how I got into the space. 

As I started reading books, I read books about technology. What got me interested initially was the concept of decentralization — I realized it could make things just so much more efficient. 

To share a bit more background, I worked at one of the market makers in the traditional space. As a market making traditional space, you deal with all kinds of intermediaries like custodians, clearings, and exchanges. 

If you think about it, this whole system is very inefficient. Like settlement cycles, and just how slow it is and what kind of legacy systems are running on it. Blockchain was pretty obvious in fixing a lot of that. And that’s what initially got my attention. 

Fast forward to 2017; I was busy. I had just moved to London. And I was reading about blockchain and thought, why not just let me try to do something there. So basically, I just downloaded the Coinbase app and just bought a bit of Bitcoin with my credit card, and it just kind of started. 

But I got kind of lucky because literally a week later, it skyrocketed. I don’t know, 50%-100% of the balance. And that really got my attention. And that’s how I started looking into it.

Stephen: You said you moved to London. Where did you move from?

Evgeny: So it was kind of a part of my broader drive to do something different outside because I was in this market making traditional space called Optiver. And I was there for 10 years as a market maker in ETFs. 

And it was a really exciting journey, but I felt that if I just stayed there longer, there was no way I could do anything else in my life. And so I decided I’m just going to quit and move to London with my family and start searching for something.

Stephen: Where were you living? Which city were you in? 

Evgeny: Amsterdam.

Stephen: Okay, so you were in Amsterdam at a big ETF. And then you decided to check it all in, and then you just stumbled into Bitcoin. And you started this asset class with 100% volatility; you don’t see that in the real markets. 

Evgeny: And it was super refreshing because if you think about traditional markets, even now, given the recent GameStop madness, it’s super boring. You don’t see anything moving more than half a percent or 1 percent a day usually. And Bitcoin changed that.

Stephen: So that’s interesting, and we will talk about this a bit later, but I agree. In the beginning, you said you were interested in blockchain. I agree with that. I think with blockchain; people don’t get it. It’s the Amazon moment for financial services. Crypto and Bitcoin is the most interesting use case right now that gets all the press.

But I agree with you; I think the story is about blockchain, and we can talk a bit more about that. So, given your FinTech and entrepreneurial background, I guess that’s about when you saw the value in blockchain. And then obviously, Bitcoin is just the use case. But what other sort of applications in blockchain are you excited about beyond Bitcoin?

Evgeny: Well, definitely around DeFi in general. We’ve been involved in the DeFi space as a market maker, liquidity provider, and as a builder. 

So we do build applications. I think you guys will hear about us a lot more in the future in that regard. So I think the DeFi space is super interesting, and I’m kind of really warming up to NFTs. 

Again, I’m quite late to the game, but I get a lot more excited about them than this. I’m really interested in gaming versus this whole concept of a metaverse in general because we used to have this game called Second Life back in the day. It sounds like a more decentralized version of it, which I’m quite excited about as well.

Stephen: So for those of the audience that don’t know, why don’t you take us a bit through what Wintermute does? Tell us what functions are performed in the crypto space, and don’t assume they know what a market maker is in the real world; really explain what this is.

Evgeny: So, in a nutshell, we are a market maker; we are operating in all the major centralized and decentralized exchanges. And as a market maker, our main function is to basically provide liquidity. 

So when you look at the order book on any kind of exchange, let’s say Coinbase, you’ll see bids of all persons, and there is basically a 90% to 95% chance that it’s market makers providing those offers. 

So to do that, you need to have pretty advanced systems in terms of technology. You need to make sure you manage your risk really well; you need to make sure that you get all the price fees for all the major liquidity sources, so you can aggregate them and create your pricing, and that’s basically what we do. We trade about $3-$5 billion daily across all kinds of platforms.

Stephen: So, take us back to 2017. You just moved from Amsterdam to London, so walk us through the early days of Wintermute, how you built out your team, and any tactics or strategies you can share during this time in the early days.

Evgeny: Prior to Wintermute, I basically started playing the script in general. There was already Bitcoin, Litecoin, and Ethereum, so I started basically trying to arbitrage it manually. I tried to do some trades — a bit more sophisticated trades. Then I said, “Okay, it makes sense for me to basically leverage my life’s knowledge, so why don’t I just start a market maker in this space?” 

So I teamed up with another Optiver guy, Harro, who became our first CTO. And later on this year, he started heading our big efforts. And at the very initial stage, we just started doing arbitrage. The whole experience was super refreshing to me personally, as well, because while being an optimist, I was a trader. 

So I was typically coming up with new strategies, telling developers to call them and just waiting and waiting for them to do stuff. And it’s kind of how we started at Wintermute. 

I basically told Harro what needs to be done, he started coding it, and I was basically waiting. But waiting kind of sucked. So I decided, okay, it might make sense for me to start coding as well. And so I did. I got into Python, started coding, and sped up things quite a bit.

Stephen: It was just two of you and a computer in the beginning?

Evgeny: Exactly.

Stephen: You’re probably in a bedroom or something. And now, it looks like you’re in an office. I can tell. How big is it now? How many employees do you have?

Evgeny: We have about 40 people now.

Stephen: In three years! That’s pretty quick growth. I’m sure it’s a mix of developers and engineers and trading? 

Evgeny: It’s primarily developers because basically since then, we never hired anyone for a pure trading role.

Stephen: Interesting, it’s programmatic. It’s algorithmic. So basically, you’re programming a computer to do the trading. You don’t want discretion. 

Evgeny: Exactly.

Stephen: Just so the audience can understand, there’s quant trading or Algo Trading, which is computer-driven, and then discretionary is the opposite. That’s where the person makes the decisions. 

So you mentioned DeFi, and we hear a lot about that because, obviously, we run an exchange, which is CeFi. We’re essentially the opposite of DeFi, but what was the value proposition of DeFi that made you take notice? And just for the audience, that’s decentralized finance; that’s what that stands for.

Evgeny: Yes, I think it was the same kind of reason that blockchain fascinated me because it’s just the next level. And we might be really far away from anything scalable on DeFi. But as a concept, it was really interesting and novel. It was really interesting because with DeFi, you have lots of different building blocks that can basically talk to each other and operate with each other. 

You can build whatever you want out of those building blocks, like lending protocols and exchanges and a lot of other things. And I think that that’s what really excited me because you build those primitives, you build those blocks, and they start talking to each other in a way you cannot imagine right away.

Stephen: And certainly back to DeFi, there’s been a pretty interesting debate that’s been bubbling up online since last year over the future of finance and whether it will remain centralized, which I think there will always be centralized finance, personally. 

But the debate is will the whole thing become decentralized. Where do you see the landscape heading? And the regulatory angle as well?

Evgeny: I think the regulatory angle is just where this will come from, to be honest. Because currently, most of the centralized exchanges, one of the key reasons they’re here is that there are fiat rails. 

So if you have dollars, even if you want to get them to DeFi, you need to buy Ethereum, for instance, with them. Otherwise, there’s not much you can do. That’s one big reason centralized exchange appeared in the first place.

Stephen: That’s why you would have to trade with Bittrex Global. Ironically, we list DeFi tokens on a centralized exchange. So yes, for that very reason, I agree. 

Evgeny: Exactly, and that’s kind of what makes those centralized exchanges propagate as well. Because instead of using Ethereum to go to Uniswap to buy a token, you actually can buy it on Bittrex. 

So it makes it much, much easier, and that creates a sort of recipe for centralized exchanges to stay in business for a considerable amount of time, if not forever.

[12:24] The Next Big Thing

Stephen: Well, hopefully, I’m betting on forever, but in terms of DeFi, one of the things we see about DeFi, and I’m a big supporter of the space, we just don’t know how it’s going to play out. 

However, at the end of the day, I always say things settle on the blockchain. They’re subject to the existing laws of finance, and I think it’ll be interesting to see how the regulators cope with some of the lack of KYC and other things on these platforms. 

So I think it’ll be interesting to watch, but in the interim, as you said, the lack of clarity creates a lot of trading opportunities. So we’ve seen a lot more and more innovative products flooding the crypto ecosystem over the past few years, from earning interest or yield off your crypto to DeFi liquidity pools and tokenized securities, which I have to give a shameless plug to Bittrex Global because we’re one of the few regulated places that’s actually offering those. 

What do you think is the next big innovative product to shake up the crypto space? I mean, you mentioned NFTs, but what are you most excited about?

Evgeny: I’m really looking forward to the emergence of index products because if you look at traditional finance, you see that people primarily actually trade ETFs. As for single stocks, it’s exceptional this year because back to GameStop and everything; people primarily don’t trade them. And it’s generally good advice to just stick to index products because it’s much more stable. 

And I would say in crypto, that should be the next big theme in general, and there are a bunch of DeFi protocols that offer those kinds of products. That would be quite exciting to see those kinds of products being listed on centralized exchanges, and we’re going to be really interested in providing liquidity as well.

Stephen: Right. I agree with that. We’ll see how the market goes, but I think it’s interesting to see you have Grayscale taking crypto indices and making them look like stocks. 

And then you can go the other way around; we can make a digital token out of either other tokens, or it can be out of stock. So it’s the combinations, and the way you can cut it in slices is pretty interesting. But I agree it’s very early days; we don’t know who will win this. 

So switching gears and talking about markets for a bit, which obviously that’s what you do for a living, making markets. So the last several weeks have been pretty interesting, or frustrating, following from a market perspective, depending on how you’re positioned. 

We’ve had huge gains, and record after record, we saw a complete market bloodbath around the middle of May and then weeks of a slow recovery. 

And now we’re seeing pretty strong market recovery. All these crypto chat groups and everyone deciding you should sell in a bull market. What is your view on the second half of 2021? Do you have a view? What do you think markets are going to have in store for us?

Evgeny: Well, this is not investment advice as I think we all should mention.

Stephen: Of course, we never give investment advice either.

Evgeny: But in general, I guess the market was definitely super overheated back in May; there were all kinds of crazy tokens rallying like hundreds of percents. So the correction did make sense. 

I think like what we saw in June and July was often, from my perspective, the combination of a lot of people being taken out of the system by this massive correction. But on top of it, you have COVID easing down a bit, and summer starts and things that don’t cause people to worry about the markets less and just retreating a bit and enjoying life. And it’s kind of mirroring what happens in traditional finance as well. 

Summer is generally super, super slow, and boring. So for my personal predictions, I will say that we will see a lot more activity in the market in September. And we already see a lot more activity now compared to July; we may see DeFi Autumn or something.

Stephen: Okay, I’m looking forward to the DeFi Autumn, and I’m hoping we don’t have any more COVID variants to talk about, but let’s see. That’s harder to predict than the crypto markets, actually; the crypto markets strangely behave more rationally than the COVID variants. 

So getting back to the background you shared earlier, what advice do you have for people who want to make the jump into crypto? 

I mean, I’ve done it as well. I came from traditional finance; I got the crypto bug around the same time you did. I’m not a trader, obviously, but it just seemed so compelling. It reminded me of hedge funds in 1980, there’s so much inefficiency, and you can just kind of go out and do something really great. 

What would you share in terms of people who are like you and have come from traditional finance and are sort of making the jump?

Evgeny: I’ll definitely say don’t look at some really obvious things like arbitrage. It’s pointless to try to make a board that will arbitrage Coinbase and Kraken because our market responses will do it much more efficiently than you would. 

But instead, I would say there’s a main opportunity, especially in the DeFi space, on chains like Ethereum but also on other chains like Solana, there are all kinds of new protocols popping up and all kinds of new primitives being built, like all kinds of NFT platforms, games, you name it. 

So basically, I think the biggest opportunity, in general, to get into this niche to try to understand how a particular protocol or project works, be one of the first adopters of it. There are so many things going on nobody can possibly keep track of it. So it doesn’t make sense to focus on one or two or three and be one of the early adopters.

Stephen: That’s interesting, and I don’t think you had the same experience, but I made the jump back around late 2017, early 2018; people thought I was nuts, coming from really boring traditional finance, but now we don’t look so nuts. 

Now I’m getting many calls and new friends on LinkedIn who want to know how to get into crypto, but I think it was definitely an interesting few years in this space. Have you felt like you were a bit in the wild west or out cold?

Evgeny: Yeah, we all have to survive. 2017 was fine, but then you had to survive 2018 and 2019, which wasn’t fun at all.

[19:02] Global Domination

Stephen: So with the crypto winter, that is another thing I was going to ask you; where did the name Wintermute come from?

Evgeny: It’s basically a character from a science fiction novel called Neuromancer. It’s very straightforward because I needed to pick a name for a company, and I’m quite into science fiction. 

So basically, I simply took out the top 10 science fiction books ever written and wrote down a few characters from all of them. And it sounded nice, so I just went with it.

Stephen: That’s a cool name. I like it. 

So in terms of Wintermute, just on a more serious note, it’s obviously very hard to predict markets in the new crypto space; everything’s moving so quickly. 

But what are your short-term and long-term visions for Wintermute? And what makes you stand apart from your competitors in the crypto space?

Evgeny: I think we have really big plans, in general, going forward. So we don’t want just to be a market maker on all centralized and decentralized exchanges; we want to be the big guy. 

We are one of the top market makers out there. But going forward, we are expanding in derivatives, OTC trading, and in the traditional markets as well. We basically want to be present everywhere as a trading market maker company.

Stephen: So, global domination? 

Evgeny: Exactly.

Stephen: You want to be like the Amazon of crypto; I like it. So, I’d love to hear your views on this as a fellow poacher-turned-gamekeeper because we left the old world and never tried to undermine it and destroy it from the crypto side. But it’s interesting. 

So I look at the tokenized stocks as something we’re doing, and this is just an example or an analogy. So here we are building our tokenized stock trading, but you hear the traditional exchanges are talking about doing it, and the same with the banks. 

Of course, my personal view is that the crypto firms are biased, but I think we’ll be the winner. Now, I think it’s very recency bias or very arrogant just to assume that just because Goldman decides to get into crypto, they’re going to have a clue because they’ve stayed out of it for so long. 

And they have no idea the markets are moving so quickly, and I think firms operating the space tend to be much more nimble. So I think finance in general, with blockchain, will be turned upside down on its head. And it’s not clear, though, that the traditional players are going to be the winners in this space; I think you might see some new names like yours or ours that are going to be doing this because we have huge ambitions as well. 

What’s your view on that? Who’s going to own it in five years from now if we look at the big names in finance? Do you think it’s going to be some of the crypto names, or do you think it’s just going to be the traditional guys?

Evgeny: I think being nimble is really important because I know how slow the banks are, and this is not something they can do well. I know this because I already had a few goals for the banks, and I know how these institutions operate from my past life. 

They can decide to build something in 12 to 18 months but not even start building. So by now, they probably decided to build stuff. And so I think that’s the biggest challenge, in general. For everyone, for all of us in crypto, we need to be nimble.

[22:16] Ignoring Regulations

Stephen: As a market maker, real-world or in crypto, do you fall under any regulation? Or is it just a trading firm with no regulation?

Evgeny: For instance, in the UK, we’re registered under the FCA as a C-Business. If you were to trade versus doing derivatives in the US, we would definitely fall under regulations as well. 

So we do fall under quite a few regulations, and we do follow them where it’s required.

Stephen: That’s good. Yeah, that’s a similar view I take. So I think in the crypto space you have sort of two camps: you have the camp that they are this is the technology, and those rules don’t apply to us, and I don’t think that’s going to end very well, and that didn’t end well for a BitMEX, which just settled, and some other firms who shall remain nameless and are quite in the press recently with regulators not happy with them. 

Now I think our view has been very much, as I said before, just because something settles on a blockchain, it’s still subject to rules, which is why we went the whole regulated route. And we thought that would be very appealing coming from that world of institutions. I knew that with institutions, they looked at counterparty risk; is there a compliance department that they’re going to have to approve? 

So we set up in Liechtenstein for a utility token exchange, AAA-rated Swiss franc currency. There’s already an existing financial services business there, and they passed the Blockchain Act, and it’s EEA. So we have the FMA, which is an EU bank regulator, supervising the exchange, and we’re doing MiCA level KYC/AML. And then for the security token trading, we got a secondary license in Bermuda, which, again, it’s UK regulation under the BMA with super tight KYC/AML. 

We also have supervision by the BMA, and they allow security token trading, so we sort of anticipated this. We thought, even though in the short run we may have lost market share to competitors who are a bit more, shall we say, “less regulatory focused,” it’s okay because we think in the long run, and that’s why we’re going to win. 

So I take the same view as you have on these ex-finance guys; you understand the regulatory framework so we could operate in the crypto space. I think that’s the way forward.

Evgeny: I think it’s also that if you are really ambitious to grow large, you need to think about regulation; you cannot just ignore it. Part of me would love to completely decentralize Wintermute and just be anonymous traders on DeFi and just be whatever you want. And good luck finding us. 

But regulators will find us eventually. And also, you cannot really grow super big as an anonymous organization. You have to move into the real world eventually.

Stephen: Well, you can, but you’re quite vulnerable to being shut down. And the whole thing can implode so quickly. So I think it will be interesting to see some of the behemoths in the industry right now, who shall remain nameless. 

But I think just because you’re this big, you’re assuming that’s a stable regulatory setup and that they don’t check your website or whatever. These things can be destroyed immediately by negative action regulators. So I think that will keep lots of volatility in the markets and lots of opportunities. So we like it. It’s good if you’re doing it the right way. 

So Evgeny, thank you so much for coming on the podcast. To wrap things up, I’d love to ask one last question. 

We’ve talked a lot about the amazing things Wintermute is doing, and I’d love to hear about any other projects or blockchains or cryptocurrencies or anything else that you’re interested in, or that you’re watching, outside of Wintermute, in the space that you think the audience should also be paying attention to in crypto.

Evgeny: Just like I mentioned before with index products; definitely look into it. There are a lot of index-based products being built. 

And the other thing is options are going to be really interesting to see, especially in DeFi, because on centralized exchanges, you have their bid. But on decentralized exchanges, in the next three to six months or so, you’ll see an explosion of projects that will do options. So I think it’s going to be quite exciting as well.

Stephen: Excellent. Well again, I think you’re very humble, and congratulations with Wintermute. It’s been a huge name in the space and it’s been massively successful. I think everyone’s very impressed by what you’ve built in a very short timeframe. And it sounds like you’ve built it the right way. 

So I really enjoyed having you on the podcast, talking with us, and learning about Wintermute; we learned a lot about the different projects and what your team is working on. And again, I’m expecting great things and hearing more great things about Wintermute in the future.

Evgeny: Yes, thanks a lot for your kind words; I think it was an amazing conversation.

Stephen: Excellent. Thanks, Evgeny.

Stephen: Thanks for listening to The Bit, the Bittrex Global podcast. Our guest today was Evgeny Gaevoy, the CEO of Wintermute. To learn more about Wintermute, visit

To learn more about Bittrex Global, visit And please make sure to subscribe to our podcast. You can find us wherever you get your podcasts. Thank you for listening and making The Bit one of the fastest-growing podcasts in the world of crypto. I’m Stephen Stonberg, the CEO of Bittrex Global.