This is Clearing Spotlight — where markets meet clarity, and institutions navigate liquidity, risk, and infrastructure.
In this episode, we welcome Michael Ashby, CEO and CIO at AlgoQuant, for an in-depth discussion on how crypto market structure is maturing—and what it will take for the space to attract serious, durable institutional capital.
As digital assets push further into the institutional mainstream, the conversation is shifting from price and product toward the harder questions of market structure, trust, and discipline. Drawing on two decades in traditional finance and seven years building AlgoQuant from a family office into an institutional multi-strat fund, Michael shares a candid view on what crypto still needs to borrow from TradFi—and what it can genuinely improve upon.
The discussion explores why so much of crypto's infrastructure was built by technologists who skipped the lessons behind TradFi's design, whether the benefits of centralized venues can be rebuilt on-chain, and why the blurring of trading, custody, and clearing roles remains one of the space's biggest structural risks. It also digs into the practical reality facing fund managers today: compressing returns, the capital trap for sub-scale funds, the credit-risk problem behind stablecoin lending, and the perverse incentives shaping token listings and ecosystem investing.
Key topics include:
Why crypto market structure is still "graduating from junior high," and what TradFi got right that crypto skipped
Whether good market structure can be rebuilt on-chain—and why KYC gaps keep institutions off DEXs
The risks of blurred archetypes: custodians lending, prop firms acting broker-like, exchanges doing prime
How operational due diligence is becoming a real discipline in crypto
Why directional and market-neutral strategies are getting harder, and the "capital trap" facing sub-scale funds
Why stablecoin lending as a fund strategy is rarer than the rates would suggest
The perverse incentives around early token listings and ecosystem/venture investing
Why This Matters
The institutional crypto market is entering a more demanding phase.
The easy returns of previous cycles have largely disappeared, and the firms hoping to attract institutional capital now face a higher bar: robust infrastructure, clear separation of functions, credible risk controls, and genuine operational discipline. As regulation opens the door for traditional players to enter, competition and consolidation are likely to reward those who solve the core structural problems—and expose those relying on band-aids.
This episode explores how a serious allocator thinks about building trust in a market that is still maturing, highlighting the intersection of market structure, credit, and technology that will determine which firms, strategies, and assets earn lasting institutional participation.
Listen to the Full Episode
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Episode Timeline
[00:00] — Introduction
[00:25] Meet the Guest
[01:44] Does Crypto Need Wall Street's Plumbing?
[05:32] Can Institutions Ever Trade On-Chain?
[07:58] Why Crypto Firms Wear Too Many Hats
[09:50] The Risk Hiding in Crypto Custody
[11:43] How to Vet Your Counterparties
[13:11] Will Allocators Look Beyond Bitcoin?
[16:54] Why Crypto Lending Hasn't Scaled
[19:53] Backing Projects Before the Token
[22:30] Do Exchanges List Tokens Too Early?
[25:25] Can DeFi Yield Attract Real Money?
[27:20] Final Thoughts
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