A London-based cryptocurrency trading powerhouse is making waves in the financial sector by paying its staff an average of more than £1 million each. The firm, Wintermute, has reported staggering financial results that highlight the immense profitability and intense competition for talent within the digital asset industry.
Record Profits Fuel Seven-Figure Pay Packets
According to recently filed accounts, Wintermute Trading, the main UK entity of the global crypto market maker, generated a pre-tax profit of £42.5 million for the year ending December 2022. This impressive figure was achieved with a remarkably lean team of just 40 employees based in London. When the profit is divided per head, it equates to a breathtaking £1.06 million per staff member.
The company's total turnover for the period soared to £58.6 million. These results underscore the firm's dominant position in facilitating trades across hundreds of cryptocurrency exchanges and trading platforms worldwide. Despite a turbulent period for digital assets, often referred to as the 'crypto winter', Wintermute's core market-making operations have remained highly lucrative.
Navigating the Crypto Winter and a Major Hack
The reported financial year was not without significant challenges. In September 2022, Wintermute suffered a devestating hack that resulted in the loss of approximately $160 million in digital assets. Founder and CEO Evgeny Gaevoy publicly addressed the breach, assuring the community that the company remained solvent.
The accounts reveal that the company recognised a £17.6 million expense related to this 'cyber crime incident'. Remarkably, even after absorbing this multi-million pound loss, Wintermute still posted its substantial profit. This resilience demonstrates the robust underlying profitability of its market-making business model.
The firm's administrative expenses, which include staff costs, totalled £15.8 million. With 40 employees, this suggests an average compensation package well into the high six figures, even before the profit-share element is considered.
Intensifying the War for Financial and Tech Talent
Wintermute's compensation levels are set to send shockwaves through both the traditional finance and technology sectors in London. The ability to offer potential eight-figure payouts per employee creates a formidable challenge for investment banks, hedge funds, and tech giants competing for the same pool of quantitative analysts, software engineers, and trading talent.
The company's structure is notably international. While the London entity is highly profitable, the broader Wintermute group operates globally. The UK accounts note that some services were provided to other group companies, with a £4.7 million inter-company receivable balance at year-end. The parent company, Wintermute Group Ltd., is incorporated in the British Virgin Islands.
This story highlights a significant shift in the financial landscape of the capital. Cryptocurrency firms, once viewed as risky startups, are now generating profits and compensation packages that rival or exceed those of the most established City institutions. As the digital asset industry continues to mature, its impact on London's job market and financial ecosystem is becoming increasingly profound.
