An ex-Goldman Sachs and JPMorgan exec breaks down why his market-neutral arbitrage fund has had minimal losses on its crypto holdings this year

• Anatoly Crachilov is the founding partner and CEO of Nickel Digital Asset Management.
• The exec says that the markets will remain under pressure until “the reversal of Fed hawkishness.”
• Nickel’s Digital Asset Arbitrage Fund is down about 0.4% this year, while bitcoin is down 39%.

Amid volatility in crypto and other markets, there have been major laggards in hedge funds, VCs, and investment firms.

Chase Coleman’s Tiger Global Management is down over 44% this year, sources familiar with the matter told Bloomberg. Last month, SoftBank Group’s investment arm reported a $26.2 billion loss from bets on high-growth tech stocks. 

Markets haven’t been able to shrug off investor woes over the Fed’s hawkish monetary policies, Omicron subvariants, and the collapse of algorithmic stablecoin TerraUSD. These have left both capital allocators and retail to identify systemic risks, leaving investors to retreat from risky bets in both crypto and traditional markets.