Clearpool is pleased to announce a new borrower pool launched on the protocol’s permissionless Ethereum marketplace, by Manifold, a systematic quantitative crypto-native investment firm.
For the benefit of the Clearpool community, we interviewed the Manifold team. Dive into the borrower profile below to learn more.
Tell us about Manifold and its history.
Manifold is a proprietary, systematic, quantitative investment firm focused on the cryptocurrency space. We focus on cross-venue and atomic arbitrage, as well as high-frequency trading strategies.
Funds operating in the cryptocurrency space are either venture-focused/long-biased or, if they are quant/systematic, they are largely focused on solely centralized exchange-based strategies. The latter ignores many data inputs and liquidity outlets, limiting alpha generation and best-price execution. We can outperform these groups by utilizing a comprehensive and modern research paradigm, and a low latency trading infrastructure that hits all types of liquidity venues.
We have a ~2 year operational history (1 year prop, 1 year external capital), have a team of ~15 people, and are currently trading on a fully proprietary book.
What is Manifold’s trading strategy?
Pure arbitrage (cross-venue, MEV, atomic) and high-frequency trading (1–10 minute alphas).
Why does Manifold want to borrow capital right now?
We recently moved to prop in order to internalize the upside of our highest Sharpe trading strategies. These strategies require less principal capital and can run on more leverage.
Why is Manifold interested in borrowing from Clearpool’s protocol compared to other options?
We like that Clearpool is a more transparent and decentralized lending pool. This resonates with Manifold as a crypto-native trading firm, and we’d love to use the protocol as a lending partner.
What size does Manifold typically borrow and seek to borrow on Clearpool?
We are looking to borrow 5M USD-equivalent on Clearpool — as mentioned above, we do not need too much capital, as we have invested a lot in our inventory management infrastructure and capital efficiency when running these strategies.
Why should our community lend to Manifold?
At Manifold, we hold ourselves to a high standard when it comes to making smart decisions with capital. We stick to strict risk limits, internally audit our systems, and have designed strong security measures to mitigate risks during any movement of funds. While several counterparties and firms in the space have sustained massive drawdowns in the last few years, we have been solid stewards of capital and have continued to iterate on our risk management policies.
What are some of the risk management strategies in place to ensure lenders’ funds are not misused?
- We conduct internal checks during live trading, including monitoring exchange liveness and rate limits. If an error is detected, the monitoring team is alerted, and trading is adjusted or halted based on the error’s severity. Positions are manually exited and hedged on other exchanges. Manual trades require approval from two-thirds of the investment committee.
- We manage funds using a mix of exchange-held funds and Cold Wallets, depending on trading strategies and position timing. Funds must be available for exchange-related positions until orders are filled. Our fund administrator is updated on our wallets which we prove ownership over. Assets are reconciled from blockchain-verified trades to confirm accurate ending balances and holdings. Fund movements require approval from the Fund Administrator and the Finance Team.
- We have internal monitoring to detect unresponsive APIs and stale books, which prevents trading against them and improves system redundancy.
- We have strict counterparty risk limits in order to reduce direct exposure on any one venue. The limits per venue are updated twice a month through risk meetings.
- All smart contracts that our systems interact with undergo internal audits to mitigate smart contract and security risks as much as possible.
Where do you see Manifold one year from now?
We are a talented and hardworking team. Our goal is to continue to focus on our core competencies in the arbitrage/HFT space, and iterate on our trading strategies. We want to continue the path of growing daily PnL, and generate consistent returns throughout all types of market regimes.
How will you use the funds that are borrowed via Clearpool?
We will use the funds as inventory to trade our arbitrage and HFT strategies.
Are there any media you would like to share with our community?
We try to stay off the media and focus on building and running our trading strategies.
How can the Poolsiders community keep up to date with Manifold?
Manifold’s Borrower Rating & Capacity — Provided by Credora
Credora’s privacy-preserving, data-driven credit evaluations provide a credit score and calculate borrow capacity.
At the time of writing, Manifold has a Borrower Rating of ‘BB’ and a total Borrow Capacity of US$ 12M
To learn more about Borrow Capacity and the Credora Credit Evaluation Methodology, click here.
Want to lend to Manifold?
Click here to visit their pool on the Clearpool app.