Raghu Yarlagadda, CEO of FalconX, a $3.5 billion crypto institutional service provider and prime broker, in conversation with Forbes, on how institutions have evolved their approach towards the industry, not only in terms of the assets they trade but also trading behaviors during market volatility.
In this interview with Forbes, the discussion goes like this:
Forbes: To begin, can you please describe FalconX for my readers?
Raghu Yarlagadda: FalconX is an institutional brokerage. We serve a diverse set of institutions, including some of the world's largest hedge funds, asset managers, retail aggregators and crypto native funds. And with these institutions, we do three things as a brokerage. The first is trading, second is credit and third thing is clearing. One of the things that we're focused on as a company is the next billion users that are coming into crypto. They're not just going to the well-known retail crypto exchanges. But what we see is that they are going to existing FinTech applications tand traditional brokerages. FalconX is looking to power that revolution. If you're a FinTech company or if you're a traditional broker it could take two-four years to offer those services. We are enabling the transformation in a matter of 72 hours in some cases. So for institutions, we had a brokerage that's focused on trading credit and clearing, and we are powering a lot of FinTech applications and traditional brokers as well as their offering crypto users.
Forbes: The prime brokerage space in crypto is getting a lot of attention right now. What sets you apart from the competition?
Yarlagadda: The number of traditional institutions coming into the space is just tremendous. As these institutions come in, the big pain point they care about is having access to credit and clearing under the same roof. Why? Without that seamless interplay of clearing and credit, your balance sheet is not as efficient. The generation of institutional crypto was largely going to retail exchanges. Now a lot of players are coming to brokers because they want this cohesive, integrated institutional workflow. Now, what first sets FalconX apart is pricing advantages. We use a variety of machine learning and data science techniques to extract pricing in a very reliable, secure way and give it to our customers. The reason why they stay with us for the long term is the integration of services like creating and credit coming very, very closely together. For example, without FalconX, they used to go to a credit shop, get a $2 million loan on a long-term loan and then go to a retail exchange to express their views on the market. But this workflow used to take a month. With FalconX all that can be done with by with 120 seconds.
Read the entire article on Forbes to get an answer to these questions:
- How FalconX takes a unique approach to credit issuance and pricing
- Why many institutions have suddenly gotten ‘diamond hands’
- How it is no longer the ‘Bitcoin and Ethereum’ show for investors
- Why offering NFT services is no longer optional
- Which institutions really care about Tether’s controversial reputation