YouSaid · the spoken record

David Grider

lines on the record: 55
first: 2025-08-20
most recent: 2025-08-20
sittings or episodes: 1
sources: podcast

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“I mean, I think the easiest, just follow me on Twitter at David underscore gride growth finality.capital. And yeah, that's probably the main places to find me.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Front run the seasonality into last month and the beginning of this month because August is typically poor. But those actually cushion the downside of our portfolio because those calls we bought when crypto traded off because of it, they were up. It made us money. So there's just so much of a traditional toolkit you can use across TradFine nowadays to manage risk in different ways than has ever existed in quote unquote what a crypto fund would do. And that's why we say we're a hedge fund, not a crypto fund.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Circle will benefit from a net interest margin store, right? It's going to have an improvement, and you can be longer crypto uncorrelated hedge in your portfolio, and you can be longer crypto. And you could, you know, I don't want to call it risk parity, but in traditional finance, you can do risk parity, which is, you know, you can have long rates or short rates. Rates are going to fall and you can be long risk, right? And those can balance each other out. And so there's much more ability to have just like interesting portfolios. I mean, another thing we've done is we've used traditional instruments to hedge like the VIX, for example. So we've bought call last month we bought calls at the end of the month on the levered VIX. And they actually this month, the start of this month, they traded up on us quite a bit because, you know, the market started to sell off in the beginning of this month. You could argue maybe that's people trying to.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think you're right with the toolbox, right? And you can use it both across for risk management, but even across assets. Like eventually, let's say I wanted to be, right now, we've caught the ETH rotation pretty well. Like a large portion of our fund is in Bitmine, BMNR, which we got into the deal of. And obviously Tom Lee is just having worked with Tom, worked for Tom. He's just a great operator. The execution is great. But like, you know, I'm looking forward to the day where I could buy an ETH related credit on his on his. Maybe next cycle may be a good hedge if the rate markets are, if we think the Fed's going to just start hiking like crazy, like 5%. Maybe you should go long circle.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“We also kind of mentioned it's like I hear this language there's a little bit more to go, so I'm curious based on that framework, what's really interesting now is that based on everything we talked about about these different duration exposures and views that you can take and different parts of the capital structure, you have this much more sophisticated toolbox at your disposal for somebody sophisticated like yourself. It's not just, all right, 100% long Bitcoin or I'm in stablecoins you have this whole toolbox now available and Yeah, I'd love for you to just paint a picture a little bit more of like what that starts to look like. I know you've been interested in looking into say you know like crypto corporate credit opportunities stuff like that that has a bit more of this downside protection but still that upside exposure yeah unpack and give some color around what that actually looks like”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“A hot fed print inflation, and people start to price in again one of these, the Fed's going to have to be on hold more, even though the composition of the Fed's improving, right? The stag inflation area. They price these in every four months or so, it seems like, and the market has to backstep eventually. But you could have some rerating from that. But, you know, from a macro standpoint, like broadly over the next, you know, year end currently, our view is still fairly positive for these kind of positive liquidity tailwind dynamics.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“The credit stuff, and then just where the different opportunity sets lie based on kind of what you think is going to be happening in the market. And, you know, I can say earlier in the year, and you probably know this because you read one of my notes at least from my investor letters, we were very bearish in the dollar. And, you know, that was structured with a lot of liquidity flows and the stuff that happened with obviously the Treasury QE. And we thought that the rates picture could improve relative what's being priced hasn't improved as much on the short end as you want, but we think the longer end is certainly started pricing a lot better with the recent speculation and changes of the Fed structure. And that liquidity picture probably still has a little room to continue improving. The map from a macro standpoint depends on as a liquid investor, it's always about time horizons, right? And positioning as well matter. And, you know, right now, could you see?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Well, crypto is a macro asset, of course. And I think, like a lot of listeners, they probably will understand that liquidity is a big driver. Michael Howes, obviously, been the most forward with this, and it's definitely like the best at liquidity data and the influence on Bitcoin and other digital assets. And risk in general, risk assets in broader financial assets in general. So we have, you know, look, we take different macro liquidity inputs. My partner came has developed a signal on that. It's a discretionary signal and we use that to think about every month how we want to manage risk, whether we should be more risk on or risk off. And that gives us like, you know, forward-looking view. But, you know, we have our own views as well on what we think of the macro environment that translates down into like our strategy approach, right? And how much, you know, how we want to construct the risk that we have within the portfolio, whether we want to be more directionally long, whether we want it to be more absolute return focused.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Turned on yet, and they will. Trust me, the rating agencies are going to come, they're going to start to rate these credits. I've talked to the banks about it. They're going to start to rate them. And I think once you hit that and people start to rate the credits, they start to really understand it better. I think you'll see more of a market develop and you'll see more asset, more folks get financed in different parts of the capital structure.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“You know, for me, I prefer to own them directionally to get directional digital asset upside, right? So that's one thing. But I think, you know, if the market continues on a tear and there's a lot of demand for this type of capital, I think you'll see restrictions lessen. But you're obviously not at that stage for a lot of the alternative ones because, again, there is no credit on them yet, which means that it's still very hard for them to get credit. And it's going to be much more difficult for them to get credit than it is like I think in crypto land, as we've seen in prior cycles. Like we've all lived through multiple crypto cycles where Block Fi just gave credit to anyone or Celsius or some of the desks gave you credit or some of the lending protocols gave you too much. I mean, in this traditional realm, you know, for these issuances, you're going to have actual people underwrite these credits and they're going to be much more stringent with the credit requirements. And I think so far that's why you haven't seen a lot of credit in crypto. Plus, the rating agencies haven't.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“I think it's always what the market bear? What is the current market environment? And then what are investors going to demand for your capital needs at any given time? Like right now, I think these guys are issuing equity because they can. It's the best and easiest place to issue. You know, I've seen some folks start to issue converts. I look as an investor for me. What do I want? I prefer to have a senior know sometimes collateralize. Usually they're not by secured collateral plus unsecured collateral, right? that can protect me But you know, you don't always get that, right? Most of the time they're unsecured. Senior notes is what you see most in the market. And, you know, sometimes they're actually structuring these recently with more of an eye towards what you'd call the traditional kind of convert ARB funds in the traditional market who will get some kind of prepaid forward or something where they can hedge out and do the traditional convert arb kind of play.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Is fascinating. On what Sailor and MicroStrategy are forging the path of where all these tasks can go. And okay, now we have these 2.0 versions that have all started to come on in recent months. They're at the phase of the at the markets. They haven't gone down this path yet. What do you think is the right path for them to go based on some of the lessons that sailors learned through the years? Is it worth it for them to do the converts first and then go to the preferred market or just skip the converts and go straight to the preferred? Or maybe something else even that sailor isn't thinking to doing?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“That's closest to a leverage loan. And you know what? But this interest was rich. When do you want to own something like that? Maybe you think we'll run into hiking cycle, right? Now you're going to have to, you're still going to have, so what do you get? You can reset your rate. You might have some Bitcoin spread risk if that drives crypto down or what I would call Bitcoin risk premium, right? In the hiking cycle, but you're not going to take the duration of the longer term instruments, right? So like, you know, his other perpetuals, those preferred. Some of these have, you know, eight, ten, 14 year durations based on their interest rate, which means for layman's terms, what percentage change do you get in the price of the par of the underlying? But the fair market value of it relative to percentage change in the interest rate or the discount rate applied to the security. And so those longer durations...”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“To lever up enough, right? You won't get enough. There won't be enough debt demand because those have been less liquid, still liquid in debt market terms, but less than the equity, less liquid options for raising capital for him. So I think that was like the dynamics of play. But from my standpoint, you have to always be an evolving market environment. How much does he issue and does he issue too much? That's the job of anyone watching the spaces to track like when the liquidation or not the liquidation because he's probably not going to get liquidated based on his covenants, but when you'd consider nav impairments are, right? How much, you know, Bitcoin relative to how much debt he's issued. But there's still, from this yield curve perspective, he does have everything from short duration closer to what you don't want to call it a money market because the risk is much higher, but I'd call it closer to a leveraged loan structure of a leveraged loan market because you get a floater short duration reset.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Maybe not as happy with him as much as he's been selling on the ATM. But I think also the way it traded down after the announcement or last earnings call, partially the markets were a bit weak, but I think some of that was also the market may be saying, you know, I'm worried you're just going to lever me up and Bitcoin's going to go down, right? And you're not going to be able to tap enough to raise to grow your BTC yield. And, you know, obviously the value of any of these dats is really derived from their ability to if they can successfully grow my underlying Bitcoin ETH, et cetera, per diluted share. And the market was effectively saying you've tapped out of your equity ability. Sarah's trying to say, no, no, no, we think it's cheap like a company. We're not going to sell shares from their cheap. We want to sell them higher two to four range. And the market's saying, we don't believe you. We're kind of worried that you're going to just have to lever me up. And that's the only way you can get access capital. And maybe you won't be.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“One, like you said, he's just trying to build out a risk, right? For Bitcoin, but two, I mean, his whole model is, I mean, look, I think that it's kind of like a bank, right? What does a bank do? A bank will take short-term deposits and pay lower rates. Maybe I pay someone 1 or 2%, and then I buy long-duration assets, right? I make a longer duration loan, which is an asset to someone else, and I collect a net interest margin. In some ways where he's leveraging the capital structure, he's borrowing at lower rates in Bitcoin for diluted share terms, right? And then he's buying more Bitcoin, which is a long-duration asset. So he collects a net Bitcoin per diluted share margin, right? And just like a bank, you can't be too leveraged. You can't have loans go bad. You can't have your collateral default on you, right? You squeeze your equity holders. It's the same, in a sense, model. So I think what he's doing right now at this stage is he's issued the equity market a lot. I think that some of the micro strategy shareholders are.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“They're free to explain a bit more the preferred thing now, too, because obviously Sailor started in the converts, and now it seems like he's made a pretty strategic pivot to preferred. I'm curious, why do you think that shift in focus and how do you think about, you know, I was just looking at the recent earnings presentation from Michael Strategy, and they're basically building this yield curve of various like duration based on the prefers market. And it's quite interesting, but I haven't fully landed on the right way to think about CV have a framework there.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Tried to force Grayscale to do the tender offer. And I imagine that that will definitely be something that happens. And you'll see that some of these companies eventually get cracked open and have to be sellers at some point of the underlying, which will, you know, as in all markets, that will suppress the price even further. But it's going to all depend on what the market and macro environment is. And we'll see how that all plays out. But those are the main scenarios.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Think what you just gamed out is probably the main pieces on the chessboard, and I think that where people will start is going to depend, what people will do, it depends where they start. If they don't have leverage, you can, without selling your underlying, you could take on leverage if you thought, okay, crypto's down 80% from here. I still have all equity. I can buy and I'm at a discount. I can put on 10% leverage here, buy back my shares in the open market, right? Because I don't have any leverage. I can do that without selling. I could, yes, I could try to get acquired by micro strategy at some point because this happens in traditional markets all the time, right? Tuck-in acquisition. Company trades at a 15 PE. Another one trades at a 5. It's accrued to do the roll-up because, you know, you buy at five, you get value revalued at 15 in your book, right? It compounds your growth, right? It's like grows your Bitcoin or ETH per share or whatever. And then, yeah, I look, we saw that with Grayscale where unsuccessfully some activist investors.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, have you started the game out some potential outcomes for that distressed phase? I've started to think about it myself of, okay, what happens when some of these more long-tailed dats start to trade at a discount to NAV? What's the calculus for thinking about where that leads? Is it a situation where, okay, they will first initially start to try to buy back their shares and sell the underlying? Do we see event-driven funds come in and force and start to just buy these up and then onwind them, capture that spread? Do we see the bigger dogs like MicroStrategy and Tomley acquire some of these? Yeah, have you started to game that all out yet?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Well, I think the reason to do it is it's cheaper pricing than you could probably get in the crypto native markets. Think it's safer, and I think it's cheaper, right? To get a three year call, a three year poet. I mean, I think it's the effect of buying the spot underlying, selling it at the money call, and then buying a 30% up call, and then using that premium of the call you sold to buy your put, right? That's how you replicate the structure. And I think it's cheaper to do it in this market, but you can also get the premium bump, right? So that's the other way, the other advantage of it on the nav premium play. So doing this the ways to structure trades like this are kind of interesting if you maybe think your late cycle or maybe you want to just manage risk. You don't want to take off all risk. You still want upside directional exposure, but maybe you just want on downside risk, you lose some of your call option.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, okay. So as somebody that can basically participate in any part of the capital structure of various asset classes, I was going to ask, what is the incentive for you to pursue that versus opposed to say just structuring your own options trade on like just like IBIT options or something like that? What you just described sounds quite similar to just like a call option or something like that. So is the reason that you're more interested in this because it's senior in the capital structure versus equity? Or is there other reasons as well?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Be protected as debt and you can make money two ways it could close and bitcoin could go up, you can make money, or it can close and the valuation could rerate like micro strategy valuation and Bitcoin could be flat and you make money. So there's just like unique, you know, if you're a credit investor, like a pure credit investor, that's compelling, right? And that was why they were able to do all said and told maybe a billion of credit on a Bitcoin gap right across different instruments. And I think that that's something you're going to see a lot more of.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Which are also convertible. And like, we thought those were compelling because, you know, instead of buying the equity of one of these companies, we could get through the debt markets, you could get, you know, we paid 1% of the senior notes. I think it's like 9% effective on the preferred, right? And you can get a conversion, right? These things price at one nav, roughly, you know, because micro strategy trades at a nav to the Bitcoin. So you get one nav pricing and then 30% up from that on the conversion, right? And then what do you have is the structure. You have an at the money put for three years, right? At the money put, and then you have a call option 30% up, right, for three years. And it's like, you know, by the way, the debt can be like 7x over collateralist, right? So you're not going to lose money unless it goes down. So you're pretty much money good. And you can get this put and call structure in this convert, right?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Is because from a macro perspective, I mean, we all know you're not yielding a lot with debt. You're getting eroded away in monetary inflationary terms based on the obviously the way that the Fed, other central banks have to increase the money supply. Well, really more the treasury side of it now in the US. But you're getting eat up in those terms and you can't get the returns, but you can get credit like downside. This is an area we're particularly interested in. You can get credit like downside, but crypto like upside. So as an example, one thing we did, there was a deal by Adam Back, who is obviously known for being a Bitcoin founder. And, you know, he's Blockstream founder as well. And he did this Bitcoin standard deal. And we participated in that. But we were interested in the senior notes, which were convertible, and then the preferred.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Well, the reason they could issue for zero is because people are giving them, it's embedded in the optionality that they're purchasing, right? So obviously a convert is a bond and then it's an option. And that option value, plus, and when you issue it is really what makes up for that interest rate delta that they're not paying. So the higher the volatility of presumably the underlying that translates to the underlying spot commodity Bitcoin ETH, et cetera, that translates to the stock is really what gives them the ability to issue at better rates. Coinbase, but it's not just about the data. It's Coinbase too. They just price a $2 billion convert offering 0%, I think, was the rate. And I think it was, I think it did two expiries, like a 27 or 29 and a 35. And you had, I think, one had like a 35% premium and one had like a 55% premium. So that volatility is like an interesting component. I think the reason debt markets are eating this stuff up.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think the emphasis on nuance there is really important. It's not just a simplistic as it looks on the surface. And okay, I want to look into specifically the, as we see this evolution into introducing debt markets into, say, the ETH dats, which are all the range right now. And to your point, there hasn't actually been any execution on that quite yet. They're all still so far just doing the at the markets issuing equity. We have not seen convertible bonds or prefers yet like micro strategy is doing. So, okay, first question on the convertible bond side of things. To my understanding, one of the big reasons why there's such low default or liquidation risk for micro strategy right now on their convertible bonds is because other than the initial ones that they first issued, most of these are at 0% coupon. So there's very little interest expense. I'm curious on your take, how feasible is it for, say, these potential future ETH dots to be able to issue converts?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“I think the bigger risk for the underlying is not so much a leverage liquidation. It's really at this point, right? That could change, right? People can get very aggressive at different stages of the cycle. But at this point, I think it's more just NAS fall below. You get people that are tired of the strategy. They say, I'm just going to sell my spot. And then you have some of a prisoner's dilemma where those fragmented guys start to sell. But you know what? At that stage, maybe you do have someone like a Sarah come in as a buyer of last resort if it's accretive to him to buy them up. So there's a lot of like dynamics that have to come into play for thinking about this market.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Type of leverage is also what depends for what risk you're going to create. Obviously, there's risk to the equity holder because you now have someone senior capital structure. So leverage inherently does create downside risk on the cap structure. But I think most digital asset investors are probably more concerned with the leverage that equates back to the ecosystem, which is going to cause someone to default, have to sell, or liquidate their assets. I think that stage of leverage is actually not really an issue at this point. There's a lot of things where you can look at when the term structure of the existing”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Well, I think there's probably 100 billion of assets underlying NAV behind all the Bitcoin ETH and sold outs. And most of that obviously is in Bitcoin and micro strategy, who is, in terms of the leverage of the entire space, maybe they have like one, maybe they have 10% or 15%, probably less than about that 15% leverage debt to equity on it. I don't think micro strategy represents a leverage risk. And I don't think really the broader universe actually has room to lever up. So I think you could actually put more leverage. I'm not saying take it to 50% or 40, but you could put another 10 billion, 20 billion of leverage on the entire DAT market cap. I don't think any of the ETH data have any leverage, any of the large ones at least. So there's actually room there for those to put on leverage. And the quality or”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Let's double click a little further into this dating digital asset treasury companies. So obviously we have this discussion on that panel a couple months ago. We had Tom Lee there, which was awesome literally the day before he launched Bitmine. Very awesome, obviously there's been a lot of success there. So, okay, I feel like a lot of the main points have been kind of starting to be like beating a dead horse. But one of them that's sort of unique that I'm curious on your take on is it feels to me like when you look at each of these companies in isolation as like an individual company, you're like, okay, these are not that levered, especially the ones that are just doing the at the markets and they're not even in the dead markets yet. Like it's really not that leveraged compared to some things out there. But then it's like, okay, well, when you combine 200 of them, do you have to view that differently that, you know, it's sort of like on its own, it's not that risky. But when you look at the confluence of them all together, does that in aggregate increase the potential?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Down right, you know, to be idealistic about whether data's a bad investment or good, you have to really talk in specifics, right? Is it a good investment for the person in the primary? Are you going to make money in the secondary market? Is it going to cause some underlying structural issues for flows? Like, you know, do leveraging and selling during a bear market for the underlying ecosystem, but are they also going to create good underlying metrics of adoption, right? They're going to build businesses on top of the chain. So there's a lot of different like, you know, nuances to how you think about what's frothy and what's good or bad for the different parts of the market and particularly for what investments you own”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Froth is when you see some of the more retail dominated names start to really have, I would say more blow off top type, you know, medium term blow off top moments, whether it's the ripples, the stellars, right, the non-institutionally owned names, you can get a sense there. But I think, and people have pointed to dats as froth in this cycle. And I think dats are one interesting component because you could really just bucket those in with, you know, like an IPO wave, right? Whether there's demand for IPOs in a hot market. And you saw that with SPACs, et cetera. But I think, you know, to some degree, there's froth in that segment, right? But that froth actually is probably healthier froth for the underlying market than any froth. Because, you know, as you launch all these dats, right, the price impact for the underlying is probably still very positive, right? Because now you have these public vehicles, even if they...”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“A good point, you know, look, we in the venture fund we invested in, I should mention, finality also as a venture fund. I run the hedge fund. We have a venture fund that does precede seed series A. We invested in Athena early on. So we obviously that basis trade is a big flow dynamic for suppressing to some degree because of the flows how much basis will blow out, right? You'll see that too with on the Trad 5 futures, whether it's CME, a lot of these flows at the basis is positive, they'll short the future, go into the ETF. And that's why you can see such big ETF flows for Ethereum or others. How do you measure fraud? I think funding rates and basis are certainly one of them, right? That's something I always want to watch over like a medium term cycle, right? When they hit 50 and they're blowing out to 70 like they historically have, it's usually marks a local top, but you can't really lighten wrist there and trim. But that's one certainly one component. You know, I think another measure of...”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“That'd be you just had of long the dat and shorten the purpose is really interesting comparing it to the last couple cycles we're trying to just quantify the amount of froth in the system historically it's like okay well if we have you know 100 annualized funding rates it's clear we get into that froth but okay you're just telling me here that the froth could actually be in different vectors which is interesting because you're having actually more shirts on on the perbbs side of things that that might skew it a little bit so yeah like how do you how do you measure and quantify just the froth in this new era of convergence that you just described”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Both not just the flows and the accessibility, but the fundamentals to bear from letting these become much larger markets than they already are.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Big traditional funds that are investing in DATS and shorting and hedging actual perks and futures on the underlines. For tokens, you probably wouldn't think those folks would trade. But because they think they can get some relative value or some kind of basis opportunity in that versus the underlying, like you're creating more liquidity, more flows in that underlying just through that. So it really is like, you know, I think the biggest theme for this year and potentially the next year or so is just to Tratfy convergence. And the things that are going to do well are the things where you get the convergence, right? It started with ETFs with Bitcoin. They became dats like micro strategy and sailor, but also with ETH and same thing here. And then the derivatives in the futures. I think that Trat5 convergence is going to be the next thing. And then the final piece of it is going to be the adoption, right? There's some projects that I've seen on the venture side that are, you know, they should have a lot of big institutions actually building on them. And that's going to be like the final piece that actually brings.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, look, I think it really started in 2017, but it's grown so fast, right? And it's matured so much more in terms of infrastructure and then counterparty reliability. And I think the TrabFi adoption of these traditional secures is really the next element of that. We've gone from people trading on Bitmex to get your Bitcoin leverage so you can do it on iBit, right? We use JPMorgan as our broker. And I think that that, as you see more assets that become adopted as both ETFs, but also the futures markets, you're seeing Coinbase futures and perks being rolled out. I think as that continues to, and I think that trade is going to happen a lot faster, right? Obviously, the regulatory environment now is such a big tailwind for that, right? It's really comes down. This next leg really comes down to this regulatory environment. And you're going to want, and I mean, with these dats, I mean, you talk to the people who are in these markets on the derivatives markets, they're seeing for the first time people I talk to.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“It feels like that's been one cross criminage, just yeah, apple go into the traffic world less so until those all-chain alts. And at the same time, you just have that constant supply issue from the VC side of things. I'm curious as well, like another cross current is just the derivatives evolution in the crypto world. So it felt like the last five years or so, it's been so predominantly like, you know, perps market driven perpetual features for those that don't know what those are. We've obviously had this institutionalization of crypto assets. We now have very liquid options on like BlackRock, ETS, and that sort of thing. And then I'm curious as a professional allocator, how have you seen that evolution in the derivatives market of the crypto world?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“And it's usually the ones that have better fundamentals, I think, is what we've seen. Lately, it's been ones that are behind this ETH narrative and trend. But a big part of the problem is things just get sold from the venture universe in the capital allocation, right? You got 80 billion of venture. Maybe there's 20 billion of fundamental hedge fund money trying to buy that. And the crypto is token sphere. And it's just a mismatch, right, of supply-demand fundamentals. And you got to go where on Tratfi, the flows are coming in and outweighing the supply of Tratfi related digital asset investments. And you just got to, you know, that will flip back, right? Like we want, you'll want to go back to tokens at some point and be there. But you just have to kind of manage what the current environment is over time.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“The saying history doesn't repeat it, Ryan's. I think we've actually had a great all season. I think the all season has just been inequities, crypto-related equities. I mean, if you look about what's happened in, you know, you could one say the dats, but even Circle, Coinbase, Galaxy, a lot of the miners, right, you've had an alt season in the Trad Fi cry crypto related universe. And I think because it doesn't show up in your DOM chart, right, your CoinMarket DOM card of tokens, maybe it's not as readily apparent to everyone, but I think being able to realize where the flows are coming from and then where the fundamental dynamics are at play. So, I mean, why do I think we haven't had as much of an all season in tokens? Well, I think you've seen you have seen unique tokens have great outperformance on their own, but it's just very slight handful.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“I'm curious if you've noticed it seems like something I've noticed over the last couple years, which is, okay, the super simple way to describe this is either we have an all-season or we don't have an alt season. And what I've noticed over the past couple years, and I'm curious if you've seen this in more of the quantitative correlations in crypto assets, is it feels like we've seen this maturation of the asset class or we have some things that are doing well, some also that are not doing so well. Have you noticed that in just like correlations as you manage them through it?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Senior notes, right? And we could get crypto upside, credit downside. And then go, you know, as the market came out in April, May, you can go back into directional, long, long just digital asset exposure. But I just think the two components I'd say are, you know, one, obviously, again, managing your gross overall risk. And then two, managing your risk within your portfolio and across your strategy. And that's how we approach it, but there's obviously a lot of ways to do it.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“And to some degree, that's a derivative of the beta of high yield and of equities because macrocycles, crypto certainly moves together with those on the risk curve. But now with the way that the market is maturing, things that we're looking at with our strategy and we've done is, like I said, we didn't want to be in cash in the beginning of the year. So in February we went and bought the micro strategy preferred. And you can use different parts of the investment universe to get different types of uncorrelated and diversified returns. So we got paid 9% effective to own those. We then got they traded up on us some because rates were people were pricing in a bunch of Fed cuts, right? Because the world was falling apart at that part of that beginning part of the year. And then we said, okay, like we're close to the bottom, right? Maybe we're, we don't know Bitcoin could fall out, you know, go to 60K from here. It's like 80. How do we want to get exposure? Well, we can use other instruments like MicroStrategy.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Think the main source of alpha is just being able to manage risk. You know, I think a lot of folks really got hurt in obviously January and February. You know, our strategy, we have, you know, my partner come out, like a quant genius. We have a macro signal. We took a lot of risk off based on that. It's a scratcher signal, but we went to 50, 70% cash at the end of last year, beginning of this year. That helped. And I think, you know, one, being able to compound and manage risk both with managing your gross exposures when everyone's bullish maybe and trimming there, but also, you know, I think in the strategy mix is also an important thing. So, you know, you got to have a strategy mix that can be diverse, can give you diversified returns. So historically, you know, when markets go down, people would just be in, you're in Bitcoin, you're ETH, and you're in all these altcoins, and everything's just a derivative of the beta, of the overall market, right?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“An interesting one because it's, you know, it's always this difficult challenge of outperforming your benchmark. And let's just use for like, that's why we've just said super simple terms. Okay, Bitcoin is our benchmark. So, okay, you have the situation where it just feels like the beta is the thing that has just been so durably strong, which has made it very difficult for funds of any means that are trying to seek out this alpha to outperform that. What do you view as like the main sources of alpha for the crypto world as like an institutional trader and especially for those that are listening that are maybe like a portfolio manager in the TradFi world seeing a lot of these things happening, these digital asset treasury companies, civines, yada, yada yada. Yeah, what are the main sources of alpha that you see in the crypto world? Breakthroughs begin with semiconductors. With over $23 billion in assets under management, the VanX semiconductor ETF ticker SMH is not only the largest semiconductor ETF, but it has also”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Might have asked one of the hardest questions for any digital asset fund. What do you benchmark yourself against? It seems like it could be simple, right? I don't think anyone really knows the right answer. I think for the simplest one is like Bitcoin. People will say Bitcoin. But there's also a lot of recency bias. So like, you know, if it was 21, people might want you to benchmark versus E. They might want you to start benchmarking versus ETH and three months from now, they say I could have just bought ETH for the last three months, right? But the answer for what we do, we actually, we're pretty transparent. We don't need to give when we talk to investors. We give them almost every flavor, right? We give them what we think could be the main liquid assets. We do the indexes of the multi-asset indexes for crypto, the market capweighted ones. And then we also look at TradFi and some of the fund indices and say, pick your flavor. You can compare us to this, but I think most funds I talk to, most funds try to benchmark themselves.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Do you manage the risk a bit, and how do you measure success? Because this is something I've been thinking a lot about, which is just trying to understand risk adjusted return within the realm of something with such high volatility. Like, you know, does it make sense to benchmark yourself against, I don't know, like the S&P or something like that, or like a 60, 40 portfolio? Like, yeah, how do you think about just this notion of risk adjusted return in the digital asset space? How are you benchmarking that success?”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“And that's kind of the way we kind of look at the universe. And then, like, you know, how you approach that strategy and the framing obviously has a lot of macro and fundamental underlying things you have to do to approach that and hopefully get good returns for your investors. But that's generally the overview for our thesis.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, you know, I actually don't think of us as a crypto fund. I think of us as a hedge fund that invests across the digital asset industry. You know, the way we focus the strategy, I think it's interesting. You could look at, you know, like a sector-specific fund. There's biotech, but maybe energy is the best analogy in this traditional world. You're an energy focused fund. Invest in the spot commodity. That could be Bitcoin ETH, et cetera. They can invest in derivatives around it, futures options. But they can also invest in the companies. It can be a small Cappy MP. It could be a large cap major, one of the Exxons, and it could be across the cap stack in debt and equity. And, you know, the way we try to approach it with our fund is maybe a little different than most other what you'd call crypto funds. We try to approach it from that perspective of, you know, there's this new industry, you know, there's a lot of interesting opportunities both across the traditional world and then the digital asset native world. And we can invest in these different securities or non-security commodities that we can take advantage of the market environments.”
2025-08-20 · Forward Guidance · Crypto Credit Markets Will Rewrite Risk Management | David Grider · IDENTIFIED FROM THE TRANSCRIPT