The 'Widowmaker' Crypto Trade That Helped Blow Up an Industry

Odd Lots

Over the last year, numerous things have gone wrong for the crypto industry. (Too many to list.) But one thing we've learned is that there's an incredibly high degree of interconnectedness between various firms, all borrowing and lending from each other in a way that created a tremendous amount of fragility. A key entity in all this is GBTC, the Grayscale Bitcoin Trust, which was one of the first regulated entities that allowed ordinary investors to get Bitcoin price exposure. Over time, this trust turned into a behemoth, with numerous players making massive leveraged bets on it. On this episode, we speak with Ram Ahulwalia, the CEO of Lumida Wealth, who explains how the fund works, how the trade worked for investors, and why it's ended in tears for so many players.

See omnystudio.com/listener for privacy information.

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Over the last year, numerous things have gone wrong for the crypto industry. (Too many to list.) But one thing we've learned is that there's an incredibly high degree of interconnectedness between various firms, all borrowing and lending from each other in a way that created a tremendous amount of fragility. A key entity in all this is GBTC, the Grayscale Bitcoin Trust, which was one of the first regulated entities that allowed ordinary investors to get Bitcoin price exposure. Over time, this trust turned into a behemoth, with numerous players making massive leveraged bets on it. On this episode, we speak with Ram Ahulwalia, the CEO of Lumida Wealth, who explains how the fund works, how the trade worked for investors, and why it's ended in tears for so many players.

See omnystudio.com/listener for privacy information.

2023-01-20 37 min Transcript
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