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down with most managers now really using no more than three or four primes at a stretch . Fourteen years later and despite hedge funds and prime brokers making countless adjustments to their risk management and governance processes , the Archegos family office blow up last year is resulting in another bout of soul-searching within the industry . After incurring eye-watering losses following their exposure to Archegos , two of the most adversely impacted banks in the whole saga opted to dismantle their prime brokerage arms , with Credit Suisse shuttering the business entirely and Nomura halting cash prime brokerage in the US and Europe . “ Cantor Fitzgerald has benefited from these exits and is winning mandates from some former clients of these banks ,” comments Yalmokas . Nonetheless , he reckons the fall-out will result in additional US regulations and oversight of some of the swap instruments responsible for Archegos ’ demise . “ Any regulation which brings about greater transparency into this part of the swaps market will be welcome ,” he argues . However , Yalmokas doubts other banks will exit prime brokerage because of the perceived risks involved . In fact , he believes quite the opposite and is confident more banks will develop prime brokerage capabilities . “ Any equities business that does not have a prime attached to it is only participating in half of the wallet . I expect some of the big Canadian , Asian or European banks will pivot into prime ,” he notes . Looking further afield , Yalmokas is especially bullish about the rapidly expanding crypto-fund market , an asset class which CoinShares estimates controls around $ 72.3 billion . A number of hedge funds are looking to diversify by launching crypto-funds with PwC estimating crypto-hedge funds managed $ 3.8 billion in 2020 , up from $ 2 billion in 2019 . “ The market is already seeing the growth of Crypto-funds and tech providers to service them . I anticipate we will see more traditional providers partnering with crypto platforms and technology companies to support the growing Institutional demand ,” he adds .
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