
CMS Holdings
Ran $24B through Circle's desk, minted billions of Tether, then built a nine-figure crypto firm from $10M.
- Est. PnL
- ~$350M
- Location
- New York
Story
Site- Started CMS in 2019 with $10M and no outside money, then made 217 investments and 63 exits worth nine figures, backing Solana, Avalanche and Pendle
- Ran $24B through Circle's OTC desk in 2018, tracking the risk by hand in Google Sheets and quoting trades bigger than Circle itself over Skype
- Lost money mining bitcoin in 2012, made it back arbitraging exchanges, and got hired by Kraken for being one of its biggest customers
- Created and redeemed billions of dollars of Tether in 2017, driven by the spread between Bitfinex and Coinbase
- Owns every hardware wallet ever made and a triceratops fossil
Notable trades
Venture
2019–2026
217 deals, 63 exits
CMS joined Solana's $314M private token sale and Avalanche's $230M sale, both in June 2021, and has since backed Injective, Pendle and dYdX. It has made 217 investments and taken 63 exits, without ever publishing a cheque size.
OTC
2017–2018
$24B notional
Took Circle Trade from about $5M a week in 2015 to $100M to $150M a day by early 2017, with a best week near $4B. In 2018 the desk did $24B across 10,000 trades with 600 counterparties, tracking the risk by hand in Google Sheets. Circle sold it to Kraken in December 2019 for $1.9M in cash plus stock.
USDT
2017
Billions minted
Created and redeemed billions of dollars of Tether at Circle Trade in 2017, driven by the spread between Bitfinex and Coinbase. Weeks after leaving Circle, he called the claim that Tether issuance drove bitcoin higher .
Trading style
Relative value and financing trades. When a sector moves, the desk buys the smaller names around it and waits for them to catch up. If a contract to buy bitcoin in three months costs more than bitcoin does today, the desk sells that contract and buys the coin. The two prices have to meet on the day the contract settles, so the difference between them is the profit, whichever way the market moves in between.
Every position is scored by how hard it moves with bitcoin, and all of them count against one risk limit, measured both in bitcoin and in dollars. When the book is already at that limit, he cannot simply add to it: buying something new means cutting or hedging a position he already holds.
In a liquidation cascade the desk buys what is being dumped and sells into the bounce, but checks the spot market first: if real coin is being sold there, the fall is not a mistake worth catching. The machines only fill the orders; what to own, and how much, is decided by hand.
The funding rate, the fee longs pay shorts to hold a perp, used to tell him when the market had got too long. That stopped working once perps spread beyond BitMEX, so he reads open interest in the alts instead. He also keeps a list of the year's best performing tokens as a gauge of appetite: while those are still being bought on every dip, money is still coming into the market, and when the buying stops, people are getting out. Crowding is the risk he keeps naming: when every liquid fund owns the same basket, the edge is gone and they all reach for the same exit.
He learned to trade at a hedge fund run by a former Chicago options pit trader. He holds losers to zero out of spite and sells them the first time they come back. Traders from traditional markets are too rational for crypto, taking profit long before a move is finished, and his advice to everyone else is to sit on your hands.
Quotes
“Do you want to make money or do you want to be right?”
“The only consistent thing I've found of good traders in this industry over my years doing it is they stuck around they just always stuck around when it was shitty when it was good when it was boring when it was euphoric they were just there that's it.”
“I sat and punched a lot of order flow for most of the large funds you see today… They all own shit that was regrettable and did poorly they aren't gods they just talk about the winners, present company included.”
“Trading is a great distraction so you don't touch your investments.”
“Remove all the people who say it's priced in from your life.”
Interviews
Contributors
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