A group of former Morgan Stanley traders managed to turn their cryptocurrency startup into a unicorn, bringing Wall Street strategies to the new world. Amber Group, founded in 2018, raised $ 100 million from various investors including DCM Ventures and Tiger Global Management, with a valuation at $ 1 billion, which is tenfold its value in just 18 months. The Series B fundraiser also includes China Renaissance Group, Tiger Brokers, Gobi Partners and existing lenders such as Coinbase Global Inc. and Pantera Capital, Hong Kong-based Amber said.
What Amber does
Amber trades coins such as Bitcoin and Ether using both the client’s money and her own capital. The startup manages approximately $ 1.5 billion in trading capital, and revenue is expected to increase tenfold to $ 500 million this year. Five of Amber’s founders – Michael Wu, Tiantian Kullander, Wayne Huo, Tony He and Luke Li – worked together on Morgan Stanley’s Hong Kong fixed income trading plan. The sixth, Thomas Zhu, is a former Bloomberg developer. It was 2015 when the group – all in their 20s then – kicked off a side project to implement algorithmic trading in Chinese stocks and index futures and subsequently entered cryptocurrencies full-time. Amber has since grown into a team of 300, with hires from places like Tencent Holdings and Goldman Sachs. “The strategy we do with Amber is always quantitative”. Wu, Amber’s chief executive officer, said.
The startup has been profitable since its first day of activity and now has a net margin of more than 60 percent, CFO Kullander said. This is largely thanks to its market-neutral strategy, which is to trade on the volatility rather than the highs or lows of Bitcoin.