Bitcoin-focused hedge fund BitSpread Ltd. isn’t interested in the price of the cryptocurrency, even as it soared close to the $6,000 mark this week. Instead, the firm is looking at something else: the price disparity between the exchanges that sell bitcoin.
“We’re not interested in the price of bitcoin — high or low,” said Cedric Jeanson, the former JPMorgan Chase & Co. trader who started BitSpread, which manages more than $25 million. “We’ll buy bitcoin versus the yen if the price is high, while simultaneously selling bitcoin versus the U.S. dollar if the price is low.”
What the firm is really interested in is the price differences between the big exchanges that have sprung up, such as Gemini and itBit. BitSpread gained 80 percent this year through September, boosted by market making on exchanges in Japan and Korea, which have experienced a “surge of interest in digital currencies” after the countries legalized bitcoin use, Jeanson said in an interview. “There is incredible momentum around the world now to access blockchain networks, either as an investment or value transfer.”