Veteran investment banker and financial engineer Lionel Fournier has moved to the cryptocurrency world, becoming CEO of BitSpread Financial Solutions (BFS).
It’s a new division of BitSpread, founded by Cedric Jeanson, a firm that offers blockchain asset research and advisory services. Fournier’s BFS will specialise in customised investments, hedging and financing solutions on blockchain assets for professional investors.
Headquartered in London, BFS is an Appointed Representative (AR) of Met Facilities LLP, which is authorised and regulated by the UK Financial Conduct Authority.
Fournier went to university with Jeanson and decided to make the move to a fintech firm after 19 years in the financial markets at various investment banks.
“I was attracted to the opportunity based on my long-standing relationship with Cedric,” Fournier says. “My background is well suited for this financial solutions business, which is aiming to bridge the traditional financial and crypto worlds.”
The new firm has two types of expected clients. Firstly, traditional money managers, family offices, private banks and other asset managers who are seeking to invest into digital assets, for whom Fournier’s firm will propose and structure investment products linked to digital assets based upon the client’s risk and return parameters.
The second type is people who are already within the crypto eco-system who own digital assets, such as crypto miners and companies which have launched ICOs.
“These clients, who have a steady income stream from digital assets, will be offered the opportunity of hedging their wealth in the crypto space, as well as financing services, such as using their digital assets as collateral for loans in fiat currencies.”
Bitcoin miners know their expected monthly income stream. “They will have a fixed income in digital assets, however they have expenses in fiat currencies,” Fournier explains. “Therefore, they are exposed to the risk of the exchange rate between the crypto income and the expenses in the fiat currency. We will provide hedges to be able to convert your digital assets into fiat currencies every month at a fixed price, removing the uncertainty.”
The firm has existing partnerships with crypto institutions such as exchanges, which it intends to leverage in building its BFS business, but will be very selective within any new partnerships.
“You need to be selective – you want to be with people who are reputable,” Fournier says.
After all the hype and excitement about cryptocurrencies over the last year, the assets have actually experienced a great deal of volatility. This is a plus for Fournier’s new business, he says, as volatility creates a need for hedging services. “It’s the same as any corporation looking at the dollar/Sterling rate,” he says.
“With the market having corrected significantly this year, people understand that they need a financial engineering solution and we are here to help them with their asset and liability management.”
In terms of people wanting to invest in cryptos, Fournier points out that Bitcoin appears to have stabilised at around the USD6,000 point.
“Crypto volatility going down is a sign that the market is maturing,” he says.
“We are here to provide the right investment products for people who have a view of the crypto markets, whether a bullish or bearish view.”