Wintermute Made Staff Members Into Millionaires Before Market Collapse

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Wintermute, one of the fastest-growing crypto funds in the world, made its employees millionaires before the latest market crash kicked off. According to a report in The Telegraph, traders at the London-based cryptocurrency firm made an average of $2.3 million (approximately 1.9 million Euros) each in 2021.

Based on newly filed accounts, Wintermute paid its 36 UK staff a cumulative sum of $83 million in the year before the crypto market’s $1 trillion collapse. With these figures, it appears that the firm minted 30 crypto millionaires before the recent crypto market dip, with an average payout of $2.3 million per staff.

The colossal rewards took place prior to the recent collapse that saw up to $1 trillion go down the drain in the crypto market, marking a historical crash in the value of the cryptocurrency sector.

Wintermute Made $582M in 2021

Wintermute, whose naming traces back to an Artificial Intelligence (AI) from the 1984 science fiction novel christened Neuromancer, has come out as one of the key market makers in the crypto sector today and is reputed as a liquidity provider (LP) in the tumultuous crypt industry. The company stands among the most high-profile British crypto enterprises, despite most of its key players operating from remote bases in the U.S. and Asia, among other countries.

Using distinct algorithms, Wintermute is committed to making tiny fractions of a dollar from the arbitrage or the price difference- on millions of trades. In 2021, the company traded almost $1.5 trillion in crypto, and judging from the recent statistics following the newly filed accounts, the London-based firm made $582 million in the 12 months leading to December 2021, with the company’s revenues surging from a mere $40.4 million in 2020 to an enormous $818.5 million.

As part of the rewards allocation, the accounts show that directors, including founder Evgeny Gaevoy, shared fees worth $31 million in 2021. The accounts also reveal that the highest-paid director received $22.5 million, which was a striking rise from the previous year’s $1.6 million.

The 38-year-old executive, Gaevoy, runs the fund alongside his wife Marina Gurevich, who was the man who raised the firm’s initial funding in 2018.

An in-depth and great feature by @JeffKauflin and @forbes about Wintermute, our founder & CEO @EvgenyGaevoy and COO @emgurevich https://t.co/NkH5QoSxAd

— Wintermute (@wintermute_t) December 20, 2022

He was raised in Russia, the same country where he attended school, before relocating to Amsterdam in 2006. Gaevoy moved to London 11 years later in 2017 where he currently resides and runs his millionaire-making business.

Wintermute Suffers Falling Revenues

After a season of good fortune where the staff and management enjoyed surging profits due to soaring prices across 2021, the company’s fate has changed as it is now recording falling revenues.

According to a report on Forbes, Wintermute’s revenues have since fallen across 2022 amid the prolonged crypto winter. As a result, the London-based high-profile business reported revenues of $225 million during the first three quarters of 2022 (January to September).

The dipping revenues came as the crypto firm suffered a $160 million hack in September, which at the time, Gaevoy attributed to human error that left one of its digital wallets exposed.

A profile of London-based crypto trading firm Wintermute in the aftermath of UST and FTX's implosion and a $160M hack, as revenues dramatically decline in 2022 (@jeffkauflin / Forbes)https://t.co/jv8NGANL2W https://t.co/wXOKs0EjRE

— Techmeme (@Techmeme) December 20, 2022

Wintermute As A Pivotal Market Maker And Liquidity Provider

Nevertheless, Wintermute remains one of the largest market makers in the digital currency market, following the collapse of crypto exchange FTX and its corporate sibling, Alameda Research, the hedge fund stewarded by Sam Bankman-Fried’s ex-girlfriend Caroline Ellison.

FTX filed for Chapter 11 bankruptcy protection in November 2022 following an $8 billion black hole in its accounts after the crypto empire used customer funds to drive risky trades at Alameda. Sam Bankman-Fried, who is the founder of both FTX and Alameda Research, is currently facing charges of fraud and misleading investors. He has also been accused of misusing customer deposits.

Despite the accusations and while he faces a lifetime in prison, Bankman-Fried insists on his innocence, pleading ‘not guilty’ during multiple appearances in court, with the most recent being in New York.

BREAKING: Sam Bankman-Fried pleads "not guilty" to all charges pic.twitter.com/lCRvxiVvRX

— Crypto India (@CryptooIndia) January 3, 2023

Notably, the FTX implosion has left one million creditors out of pocket, among them being several digital currency trading companies that were exposed to the now-bankrupt crypto exchange.

In a recent disclosure by Wintermute’s Gaevoy, the executive disclosed that his firm has around $55 million of crypto locked up in FTX’s bankruptcy state.

LIVE: Watch @EvgenyGaevoy on @BloombergTV discussing current market situation, FTX and the impact recent events will have on the industry.

Tune in now 👇https://t.co/E9LqCI7o3o

— Wintermute (@wintermute_t) November 10, 2022