Facing Market Chaos with Determination | ZMQ 6th Anniversary

Ronnie_Chan
ZMQuant
Published in
7 min readMay 21, 2024

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Today, ZMQ celebrates its six impactful years in the Web3 market. This journey coincides with a monumental year for Web3 as a whole. When Bitcoin, the first cryptocurrency, came into existence with the mining of the initial block by Satoshi on January 3, 2009, few could have anticipated the incredible evolution over the next 15 years. Similarly, in 1994–15 years before Bitcoin’s birth — the World Wide Web first became accessible to ordinary users, the world’s first smartphone was launched, and China connected to the global internet for the first time. No one could have predicted how profoundly the internet would change the world. These milestones set the stage for the rapid advancements that followed.

Looking Back at Past Year

Fast forward to 2024: Bitcoin has reached an ATH of $73,780.07 from its modest start at $0.0009 per coin. Today, we have over 1,000 distinct blockchains and overall cryptocurrency market cap exceeded $2.5 trillion. The SEC has approved a Bitcoin Spot ETF, and the Hong Kong SFC has also approved both Bitcoin and Ethereum Spot ETFs. The Web3 ecosystem is steadily gaining acceptance from both the public and regulatory authorities, evolving into the future we once dreamed of.

Yet, 2024 is also a year of chaos. Persistent U.S. inflation has repeatedly dashed hopes for a FED interest rate cut, while ongoing conflicts between Ukraine and Russia, as well as Israel and Hamas, have added to global instability. Moreover, 64 countries, including the U.S. and the EU, representing 49% of the world’s population, are holding elections this year. These factors collectively add substantial complexity to the global economy.

Over the past six years, ZMQ has navigated through multiple market cycles, emerging stronger each time. We’ve seen startups rise to become industry leaders and giants stumble and fall. Despite the volatility, our belief in the transformative power of Web3 and our drive for innovation have remained unwavering. As we look ahead, our journey is just beginning.

ZMQ’s Key Achievements of the Year

Market Making

The history of market making dates back to the 19th century, originating in traditional OTC markets where dealers provided bilateral quotes through field and telegram communication to facilitate trades and reduce costs. With the emergence of regulated exchanges like the New York Stock Exchange, market makers began playing a crucial role in providing liquidity and maintaining market stability through manual floor trading. The introduction of electronic trading systems in the 1970s revolutionized the process, making trading faster and more efficient.

In the 1990s, the rise of institutional investors and retail discount brokers transformed the market-making landscape. Institutional investors demanded block trades, while retail brokers facilitated increased securities trading, leading to the growth of market-making platforms. In the 21st century, market-makers adopted advanced technologies such as artificial intelligence and machine learning to enhance trading efficiency and profitability. They also expanded into emerging markets like cryptocurrency, playing a vital role in providing liquidity and stability to these new sectors.

From the very beginning, the role of a market maker has been to enhance investors’ trading experience and reduce costs by narrowing bid-ask spreads and providing liquidity. As a participant in this field, ZMQ understands the critical importance of market making, especially for early-stage projects that are illiquid or have low trading volumes.

Our use of advanced algorithms and cutting-edge mechanisms to analyze market data and respond swiftly to changing conditions. Our innovative approach provides liquidity and stabilizes prices, ensuring a smoother trading experience for investors. This fosters strong investor confidence and boosts the visibility and credibility of emerging projects. Market making is essential for building a healthy and efficient market, and at ZMQ, we are dedicated to supporting our clients as they innovate and drive change in the Web3 world.

Starting with services for just 2 exchanges, 15 tokens, and 35 trading pairs in our first year, ZMQ has experienced remarkable growth. Today, we proudly serve as a market maker for over 120 exchanges and more than 1,100 tokens. Our HFT strategies and trading bots facilitate $1–3 billion in daily volume across over 2,500 trading pairs, encompassing both spot and derivatives markets.

We extend our deepest gratitude to our dedicated employees, supportive business associates, and loyal clients who have believed in us and stood by our side. Your support fuels our drive to innovate and excel.

Asset Management

ZMQ began as a quant trading firm in traditional finance, with asset management always being our strength. Our team, with extensive experience in quantitative trading, has leveraged their expertise to develop and implement cutting-edge low latency technologies and sophisticated trading strategies. In the past year, this formidable expertise has led our quantitative services to achieve remarkable results.

Our flagship product, the market-neutral arbitrage strategy, exploits price differentials in cryptocurrencies through spot-futures arbitrage, pairs trading, and cross-exchange arbitrage. This approach ensures stable, long-term growth with annualized returns between 12% and 25%, while maintaining minimal risk with alarms set at 0.99 and stops at 0.98. Thanks to our high-speed algorithms and the ability to navigate market volatility, this product has outperformed others over the past year, consistently delivering exceptional returns.

Compliance Success: ZMQ’s New Licensed Fund

In a market often clouded by FUD, security is always a top concern. ZMQ is dedicated to the highest standards of GRC. This commitment has enabled us to achieve $100 million in AUM without any need for promotions so far. ZMQ has obtained Type-9 license for regulated asset management from the Securities and Futures Commission (SFC) of Hong Kong. This regulatory oversight underscores our dedication to maintaining the highest levels of security and trust, further enhancing our credibility and reliability in the industry.

We utilize state-of-the-art security measures, including multi-factor authentication, 24/7 real-time risk monitoring, and a comprehensive risk management platform to ensure the utmost protection for our clients’ assets and data. At ZMQ, we strive to exceed regulatory requirements, fostering a culture of transparency and accountability.

Global Expansion

ZMQ’s rapid development is driven by our relentless pursuit of innovation and excellence. We actively host and participate in numerous events, both online and offline. In the past year, we have attended notable conferences and organized several side events, such as Consensus, ETH DENVER, KBW, Bitcoin Asia, TOKEN2049 Dubai, and Web3 Festival HK. By continually exchanging ideas and staying up-to-date with industry pioneers, we ensure that our services remain cutting-edge and exceptional.

Looking ahead, ZMQ remains dedicated to staying at the forefront of the market-making field and creating more opportunities for Web3 enthusiasts to share transformative ideas. We look forward to connecting with you at upcoming events like KBW 2024, TOKEN2049 Singapore, and Devcon in the coming months.

Recruiting International Coordinators

ZMQ is set for further expansion. In the coming year, we plan to establish an international branch with regional growth coordinators, enhancing our presence in key regions such as the EU, North America, Dubai, and Japan. This strategic move will allow us to tap into diverse markets, foster innovation, and drive our global growth to new heights. If you are a Web3 enthusiast with experience in Web3 firms and are actively engaged in the Web3 world, DM us to see if you can be the next member of the ZMQ family.

Building Stronger Partnerships

Globalization is an indispensable part of a Web3 firm, and ZMQ has made significant strides in this area. Starting from a small team in a single office, ZMQ has now grown into a company with over 50 employees, operating offices in Hong Kong, Singapore, Seoul, and London.

Today, I want to highlight a significant milestone for ZMQ. Since the inception of our Strategic Partnership Program a year ago, we have formed partnerships with many industry-leading companies across various sectors, including investment, incubation, media, infrastructure, and more. Some of our notable partners include Web3 X, ScaleBit, Certik, Unity Hub, CoinEASY, CrossSpace, Salus, SNOVA Capital, Futurism, and Back Wave.

Backed by our global team and diverse partners, we offer our clients exceptional support across all areas. Our worldwide presence allows us to provide solutions tailored to each client’s unique needs. We are well-equipped to address challenges and seize opportunities in the ever-evolving Web3 landscape.

Facing Market Chaos with Determination

As ZMQ continues to grow and evolve, our commitment to innovation, security, and exceptional client service remains steadfast. We are proud of the progress we have made and the partnerships we have built across the Web3 landscape. Looking ahead, we are excited to further our impact, drive new advancements, and continue supporting our clients and the broader community. Together, we are shaping the future of the Web3 industry, and we look forward to the opportunities and challenges that lie ahead.

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