Enabling the Institutional Adoption of Digital Assets

  • Adrien Treccani PhD, CEO & Founder at METACO

  • 07.09.2021 04:16 pm

1.Can you please tell us more about your background? What’s the story behind the founding of METACO?

Prior to founding METACO, I received a PhD in mathematical finance and high-performance computing from the Swiss Finance Institute before working for some time as an Algorithmic Trader in the hedge fund industry. 

I discovered Bitcoin in 2012, first as a speculative investment, before quickly realizing how algorithmic trading applied particularly well to Bitcoin trading. I successfully built arbitrage and trading bots over several exchanges and started to generate exponentially growing revenues using algorithmic trading. When two of these exchanges were hacked, I realized that the crypto industry urgently needed secure infrastructure to manage and store crypto assets. 

METACO was founded exactly for this reason: to build institutional-grade infrastructure for the management of digital assets. Operating as a trusted custody infrastructure partner to banks and financial institutions, we enable such institutions to seamlessly navigate the fast-paced digital asset industry. 

As organizations working with digital assets mature, their needs often evolve from core custody infrastructure to broader digital asset management capabilities. METACO Harmonize enables institutions to manage a range of digital asset use-cases from custody, trading, tokenization and liquidity, as their needs evolve. 

An orchestration layer to integrate multiple vaults, sub-custodians, and liquidity providers into operations has become a key component for many firms as their digital asset operations mature. For example, Covario, an independent prime broker for digital asset managers, supports multiple vault providers and sub-custodians and connects to more than 20 exchanges and liquidity providers.

Covario selected METACO Harmonize to manage this complexity and mitigate the risks in working with this growing ecosystem of partners. Harmonize acts as the overarching policy layer to ensure tight management of Covario’s operations, coupled with a single point-of-integration to its various internal systems.

2.What is unique about METACO and how does the company stand out among its competitors?

METACO is unique among digital asset infrastructure providers in the scope and depth of its service offering. Harmonize, our digital asset orchestration system, provides the institutional-grade infrastructure to manage a range of end-to-end digital asset use cases from decentralized finance (DeFi), to tokenization, cryptocurrency custody, and smart contract management.

METACO Harmonize offers considerable flexibility for firms looking to build a digital asset use case. Its orchestration layer provides firms with a wide degree of optionality in the deployment of use-cases. Firms can leverage this optionality to easily integrate new digital asset services as they emerge, or adapt their services in response to the fast-paced digital asset environment.

Our flexibility further extends to digital asset custody, where we are unmatched by other providers. Currently, there is a debate among digital asset custodians as to whether Hardware Security Module (HSM) or Multi-Party Computation (MPC) technology offers the most secure and adaptable key management solution for banks. We enable our partners to deploy both sets of key management solutions and even deploy a combination of both sets of tools to fit their own specific need for agility versus security. 

3.Looking a year ahead, what are the main changes that you expect to take place? What's next for METACO?

As the crypto markets continue to mature, I expect that demand for robust infrastructure to manage digital assets will also accelerate. With the advent of a wide range of advanced technical solutions for managing digital assets, there are now few remaining barriers to the institutional adoption of crypto assets.

Clear and comprehensive regulation is the final barrier that is stymying the flow of institutions to the market. A number of jurisdictions in Europe and Southeast Asia, most notably Switzerland and Singapore, have provided a clear framework for banks in this area. However, there remains an absence of clarity in many other jurisdictions. Most regulators are now moving in a positive direction on providing guidance around digital assets. 

As regulatory frameworks are solidified, they will catalyze much broader mainstream adoption. We are still early in the life cycle of crypto asset adoption. I expect the adoption growth we will see in 2021 and 2022 will likely be much broader, stronger and sustainable than current expectations.

4. Tell us more about interest from banks in staking and Decentralized Finance and how you see the institutional adoption of digital assets progressing. 

Interest from banks and financial institutions in the most well-known crypto assets of Bitcoin and Ethereum has been well documented, with most major financial institutions in various stages of implementing investment options for their clients in these crypto staples. 

Increasingly, investors are gathering a broader appetite for crypto assets and looking to diversify their portfolios in the areas of decentralized finance (DeFi) and staking. METACO provides out of the box support for Aave and several other major DeFi protocols, including Uniswap, Synthetix and Compound, making METACO one of the leading choices for institutions looking to access the burgeoning DeFi industry.

Interest in institutional-grade staking services is also growing among investors, with the low yield passive income possibilities of staking an attractive possibility among more risk-averse investors. With JP Morgan predicting that the staking market will reach $40 billion by 2025, there remains tremendous growth potential in the market for firms looking to enter at the ground level. 

Other Interviews