Auros Explains Why Liquidity Remains Crypto’s Biggest Bottleneck

Hi everyone, we're here at Salana Breakpoint in Abu Dhabi.

I'm Rachel Pepper, and I'm here with Jason Atkins, who's the chief commercial officer of Aros.

Jason, thanks so much for joining us.

Thanks, Rachel.

Thanks for having us.

So let's start with the bigger picture and look at liquidity.

What are you seeing in terms of flows and why is, why is liquidity even so important in this market?

Yeah, so I think like if you look at the last two years, we've seen really strong institutional interest in adoptions.

We've seen ETFs get approved, we were just chatting about this before, Bitcoin and Ethereum, a lot of interest for new investor types.

And we talk about onboarding new users, it's not just retail, we wanna actually onboard the world.

So you wanna onboard institutional funds, you wanna onboard real money funds, sovereign wealth funds.

When those larger investor types with different time horizons to say a retail speculator come in, they look at the asset class that's underlying and how much volatility there is.

Now volatility is caused by a number of different things, but what it's certainly exacerbated by is poor liquidity.

So a few blockers to institutional adoption that exist, it's easy to say people want to get involved.

The things that stop them from getting involved is volatility, lack of liquidity that exacerbates that, and then of course geographical distribution, so.

Obviously, being here in Abu Dhabi for Breakpoint is exciting to us as it opens up another region.

It's a clear signal from the Solana Foundation that they're very interested in the Middle East and institutional adoption coming out of the Middle East.

And for Solana specifically, it's a chain that has designed itself to be very high throughput, very low fees.

And so those sorts of friction points that get removed by Solana's design.

Combined with the geographical spread of being in Abu Dhabi, plus onboarding institutional liquidity providers like us, hopefully times it all together so that you bootstrap, the right environment for new investor types.

I think crypto's always, Talking about getting more users, getting more users, getting more users, the reality is we need to get new types of users, new types of adoption, so payments has become a big theme and everyone's talking about payments.

Why is that so interesting?

Well, because it pulls in a type of trading or a type of activity that didn't exist before.

And that's how you grow to Pi versus having the same group of people just shuffling around liquidity, which we've seen so many times.

So for me.

Seeing breakpoint in Abu Dhabi, seeing the number of participants, the types of people that are here, plus the support from the sovereign wealth funds in this region and obviously Abu Dhabi itself, is a really clear signal that they understand the problem and the friction points that are blocking new investor types, new adoption standards, and new people from coming in and, and being involved in the, in the ecosystem.

And then the other side of that equation, of course, is what we do best, which is liquidity.

How can we make sure that spreads are tight?

And that books are deep, so that anyone who wants to trade $100 or $100 million can do so in whichever way they want.

Um, for us it's a, it's a difficult thing to do because chicken and egg problem, which one comes first?

You put a lot of liquidity there, no one uses it, it's a waste of capital.

So we really look for, Chains, ecosystems, regions where we think that they're moving in tandem, and that as we increase our liquidity in those ecosystems, we can obviously match the needs of what's, what's being drawn in by the other, by the other attempts that are happening.

There's a few things I want to pick up there, you mentioned about the high throughput chains, why do you think those sort of chains, or why are we seeing such an appetite for them in a, in a place like the Middle East?

So adoption, right, in more people, more activity, more transactions.

Per second.

So if you took payments, think about how many payments Visa, Mastercard, and the traditional payment, payment, um, processors do every day.

If you have a chain that's either unable to process a large number of transactions just by design, or it's too expensive to do it, well then suddenly the feature parity against traditional web 2 versions becomes imbalanced.

You need to find ways to create a similar environment, if not a better environment for those things to occur.

And then obviously the benefits of being in web 3 and, and the things that web 3 adoption.

Uh, bring with it, become apparent, but if you're more expensive or you just can't do enough transactions, you're kind of dead in the water already.

So for Solana, focusing very heavily on, we'll build roads for the guys that are coming.

It's forward-looking, it's future-proof.

Um, and for us as a trading firm, really important.

We need very low latency, high throughput chains.

We obviously put hundreds of thousands of orders in the books every second, and we're looking at ways we can do that at low cost.

And also very reliably, so we need higher throughput chains, with lots of TPS.

Solana fits the bill perfectly, and we, we love the work that we do with Solano ecosystems.

Yeah, and you, you mentioned some of the, some of the institutions that are coming into the space, like the sovereign wealth funds starting to dip their toes in, of course, on the investment side.

And also that kind of liquidity demand conundrum.

Where are you seeing some of the biggest friction points at the moment from the institutional side?

Is it still Is it still just liquidity, are there other things that are, I mean, there's the regulatory aspects too, of, of course, it's a nascent asset class, as much as some of us will probably feel like we've been in this forever, still very young and very new.

So a lot of these organizations have to consider.

Whatever setup they have for investor protections, whatever regulatory regimes they live within, how they're allowed to invest.

So we've seen over the last two years adoption of ETFs.

It's a low barrier to entry, very easy to adopt.

You can see things like DATs starting to occur, where it's allowing other investor types that can't necessarily hold digital assets access to a point that gives them exposure to an underlying asset.

So what I'm trying to get at is the demand is definitely there.

The question is, how do we create more and more vehicles or more and more access points for them that suit the different needs.

So there's regulatory blockers, can the regulatory path come clearer?

We're seeing that in the US already.

Obviously with the Trump administration.

It's allowing for more things to be done, so that's lowering some of the barrier to entry, um, but what we can definitely see is the demand is there.

You've got more guys that used to say, Bitcoin and crypto is no go and definitely don't like your BlackRock and JP Morgan, they're all starting to look at these sorts of things, and that to me is a constant pulse of preparing for what is coming, which is mass adoption across across the globe in all sorts of forms.

And so with your global stance, you know, you were mentioning how you do have this group of um people all over the world.

Where are you most excited about in terms of, The, where are you seeing the most growth coming out?

It's a good question.

So we're, Aris is traditionally globally distributed, as we talked about, 1516 countries around the world, we've got 150 people.

We have offices in New York and Hong Kong.

Uh, personally, I'm extremely excited about Asia.

I think what we're seeing in Hong Kong especially is a, a repeat or what looks to be a repeat of what happened in banking industry in the 80s and 90s where access to Eastern capital via Hong Kong was the only pathway to access it.

So China obviously has um quite strict rules about crypto and very optically strict.

They repeat them very often.

But Hong Kong is adopting stablecoin legislation.

They're looking at ways to bring in companies and bring in in um innovation into the city, and it may turn into this forward to crypto hub that allows access of Western capital into eastern markets.

So we're based there and we're very excited to be there.

Outside of that, we're expanding quite a lot in the US.

I mentioned the changes in the US administration, really important for us to have confidence that, You know, we're not dealing in an area that's gray, we don't do anything that's outside of the rules.

So as the US becomes more tolerant and also defines the rules better, we gain more confidence to invest in that region and that's exactly what we're doing.

We've hired multiple staff in the US office and we're looking at expanding that presence even further.

It's really important that we have people on the ground, live day to day, real-time with these groups to make sure that.

They know Ari, Aris knows them and that when they need us to provide liquidity for them, whether that's market making for their token, whether that's venture investment that we spoke about before, or OTC transactions where we help foundations, individuals, um, teams to manage their treasuries and make sure that they have a.

Runway that that runs long enough for them to survive.

That's all the sorts of things you want to be able to do, and having a presence in these centers gives them that access point to us and helps them solve the liquidity question as they do the other hard part, which is building.

Building the product, building the protocol, doing everything else on the other side of the equation.

Amazing.

Well, thank you so much for joining us today, Serene, a real pleasure, and thank you for coming to Abu Dhabi.

Thanks, Rachel, thanks for having me.

Cheers, thanks Jason.