This year’s boom in crypto currencies — boosted by the presidential election of Donald Trump — is already drawing in new hedge funds. Annamite Capital, a London based multistrategy investment firm focused on digital assets, is set to officially launch in January 2025.
The firm, which is co-founded by former Citadel and UBS pro Tom Geary, and Lucas Gaylord, CEO of Euith, a crypto technology firm, has been trading and managing its own capital since early this year.
Geary likened crypto investment management to the hedge fund industry in the 1980s and the 1990s — when early adopters made sizeable returns. “Digital asset markets are much less efficient than traditional markets and are characterized by a large retail-dominated investor base, high asset volatility, wide spreads, and fragmented liquidity,” he said in a statement. The ability to add leverage while mitigating market, portfolio, and counterparty risk “has led to a small but immensely profitable group of sophisticated investors entering the market generating in excess of 50 percentreturns consistently on a moderate risk-adjusted basis,” he added.
So far, that closely tracks Annamite’s success. From the middle of March through the end of October, it had net returns of 27.8 percent in its U.S. dollar share class, the firm said in a statement. The bitcoin share class, which started trading in mid-February, gained 15.2 percent over eight and a half months, or 66.5 percent in U.S. dollars. An Ethereum share class gained 18.1 percent, or 29.5 percent in dollar terms, since Feb. 9.
Those gains were made even before Donald Trump, who embraced cryptocurrencies during his presidential campaign and even announced his own crypto endeavor, was elected on Nov. 5. That was just the capstone to crypto’s comeback after the digital asset ecosystem was roiled by a number of frauds, including FTX, and a tough regulatory regime under Securities and Exchange Commission Chair Gary Gensler.
But Washington is expected to be friendlier to crypto during the second Trump era. During the election, the crypto industry spent $135 million backing more than 50 candidates, and almost all of them have won. Notably, the candidate it backed in Ohio ousted longtime Democratic senator Sherrod Brown, a member of the Senate Finance Committee, who has been among the biggest critics of crypto on Capitol Hill.
Annamite, which began operating with more than $5 million in proprietary capital, said its focus is on building legal andtechnical infrastructure to mitigate counterparty and left-tail risk in digital assets. Over the past two and a half years, the firm has invested more than $4 million in building its proprietary technical infrastructure.
After spending years at UBS on hedge fund due diligence, co-founder Geary was one of the founding members of Citadel’s Surveyor Capital, where he oversaw portfolio managers, portfolio construction, and risk management from 2010 to 2017. Since then, he had been focused on the backend operations of crypto before launching Annamite. Gaylord has been involved in crypto ventures since 2017, eventually developing proprietary infrastructure for security, custody, trade execution, and risk management, which led him to co-found Annamite with Geary.
In addition to the co-founders, Annamite recently brought on Joseph Biscomb, who was most recently at Brevan Howard, to head up operations.
