Quantfury (the “Company”) (www.quantfury.com – outside of North America) offers traders, investors, and cryptocurrency holders, to trade traditional financial and cryptocurrency markets at existing global exchange spot prices with zero fees. The Company was founded in 2017 by Lev Mazur (the “Founder”), and since launching it’s native Android and iPhone app, in December 2018, has amassed hundreds of thousands of retail clients worldwide, in over 100 countries. Today, Quantfury has processed trailing 30-day volume over $11 billion dollars and this figure is growing rapidly as trailing 24-hour volume is $0.5 billion dollars (~15b monthly run rate / 182.5b annual run rate). The Company’s app store ratings, user satisfaction, and user retention are among the highest in the industry when compared to retail brokerages and cryptocurrency exchanges.
We are thrilled to participate in TrueFi, and are interested in borrowing 1,000,000 TUSD for 90 days at a rate of 11.5% p/a. If this loan is successful, we would plan accordingly to finance our future proprietary strategies using working capital loans, which will free up cashflow for reinvestment in the business. Given historical and anticipated returns being generated from proprietary strategies, borrowing against these strategies at a reasonable interest rate should result in safe risk-adjusted returns for TrueFi’s investors.
The Company’s business model offers retail traders unmatched trading conditions, offering both entirely free trading (free of any trading fees, commissions, maker/taker fees, leverage fees, or setup fees) and offering real-time back to asset prices directly from global exchanges (including Binance spot exchange for cryptocurrencies). The Company is counterparty to its retail traders and as such needs to enter into significant proprietary trading strategies in order to both generate revenues and manage risk of its B-Book. These trading strategies are executed on both institutional cryptocurrency trading desks as well as other reputable global exchanges.
The Company employs significant resources focused on proprietary trading, data science, and artificial intelligence, and the Founder has over 25 years of trading experience and is widely recognized as a thought-leader in the cryptocurrency space.
The Company is tightly held, with approximately 40% controlled indirectly by the Founder. Invictus Hyperion (www.invictuscapital.com) is also a 15% owner in Quantfury, having invested in the Company’s seed round. Mr. Ilya Yavorsky is a shareholder and the Company’s sole director, although the Company has a large advisory group surrounding it, including but not limited to, Daniel Schwartzkopff (from Invictus Capital) and Ali Pourdad (from Pourdad Capital – www.pourdad.com). Mr. Pourdad previously founded Progressa (www.progressa.com), a Canadian consumer financial technology lender, which was recognized globally by CB Insights in 2017, and was the 11th fastest growing company in Canada, by revenue, in 2018 in Profit500 magazine. Mr. Pourdad is day-to-day with the Company leadership team. In addition, Luke Brindle is the Company’s Head of Automated Trading Strategies, who is an industry veteran with over 15 years in quantitative trading and the hedge fund industry.
The Company remains privately held and as such does not disclose financial information. With this being said, we can share that the Company generates substantial cash-flow and historical profits and to date, it has paid shareholders over $18 million of dividends before Dec 31, 2020.
Purpose of Loan
The Company anticipates using de-fi loans in order to finance short term proprietary trading strategies. Initially it plans to allocate $1 million to its Automated Series A Trading Strategies , with details of this trading strategy outlined in Appendix A to this loan application, including historical returns.
We appreciate the community and TrueFi for reviewing this proposal. Please feel free to ask any questions, and we’ll do our best to answer them quickly and concisely.
Expected structure of loan proceeds
The Company’s plan is to take this loan in a method that protects the TrueFi investor community. As such, we have described the structure of our entities ( See Exhibit 1 ) below and how we intend to take the loan and segregate the proceeds from Quantfury’s normal brokerage business operations:
Exhibit 1 – Organizational Structure
Loan would be to Quantfury Trading (BVI) – an asset management business, with no prior operations and no assets or liabilities. Funds would be used for proprietary trading and flow back out to loan repayment, leaving trading profits to aggregate in the asset management company. Any shortfall, if applicable, due to trading losses would be covered by Quantfury TGE Limited (the parent holding company). All companies are under common control and management.
Appendix A – Automated Trading Strategy Series A
The following table shows total dollar returns by strategy for Series A. The Company employs four main strategies concurrently, as can be seen, historical dollar returns ranging from 139.52% to 481.03% per 13-month period, with maximum drawdown (on capital) ranging from 7.58% to 27.33%.
Automated Trading Strategies Series A
The following graph shows results of A1 through A4 with Total P&L results and drawdown of capital base: