Prime Time in Crypto

Plus: Mastercard, Lemonade/Metromile, Offshore Finance

Last week, under the gaze of a new chairman, Credit Suisse announced a restructuring of its investment bank. After losses racked up through its dealings with Archegos Capital Management, the bank decided to exit prime brokerage, a business it has been in for many years.

At the same time, in another place and another market, a much newer financial services company reaffirmed its commitment to enter the prime brokerage business. Coinbase launched a prime brokerage offering in crypto for its institutional clients midway through the third quarter. On its earnings call, the company’s CEO highlighted it as a key area of investment. 

The two businesses aren’t exactly alike. Equities – the substrate for the Credit Suisse model – has a different market structure from crypto. But the structure of the two markets is not a million miles apart and so it’s no surprise that crypto should borrow from models refined in the equities market. 

This week, we take a closer look at the prime brokerage business…