• Folkvang, a Cayman Island based trading firm, had half of its equity parked on FTX before it collapsed in November.
• Founded in 2020 by seasoned crypto quant traders, Folkvang rose to prominence across all major exchanges and was expected to do well after Alameda Research invested in them.
• Despite suffering a major blow during the crash, Folkvang is still going strong and is managing around $400 million in assets.
FinanceAlameda-Backed Crypto Trader Folkvang Suffers After FTX Collapse
The cryptocurrency industry has been reeling since the contagious collapse of the FTX exchange more than three months ago. One of many firms affected is Folkvang, a market-neutral Cayman Island-based trading firm that saw its equity halved during the crash.
Folkvang’s Rise To Prominence
Founded in January 2020 by a team of seasoned crypto quant traders, Folkvang rose to prominence across all major exchanges. For instance, it edged toward the top of FTX’s volume and profit leaderboard in 2022 after Alameda Research, the trading firm that played a central role in FTX’s demise, invested in Folkvang.
FTX Crash Impact On Foklvang
“Our equity was halved, so we lost a lot of the gains we made in 2021,” said Mike van Rossum, founder of Foklvand. “This is the risk right? This is the risk of the game.” At its peak during 2021 Foklvand managed around $400 million worth of assets including equity and loans.
Recovering From The Blow
“It was a tough pill to swallow,” said van Rossum about having to pay lenders back out of pocket as they were active borrowers. Despite suffering from such losses from one exchange Foklvand still managed to survive and remain standing.
In order for Foklvand to continue surviving they will have to be careful with their investments moving forward. However despite suffering such losses they are still standing strong managing around $400 million worth of assets.