Meet the Copper Team with 300+ Years of Financial Services Expertise
Nick: Sabrina, let me start with you. Your career spans 25 years with major firms across the world. Tell us a bit more about your background.
Sabrina: I started my career in London as a broker dealer on a fixed income derivatives dealing desk. I quickly realised the markets were going to digitise. I moved to JP Morgan in New York for seven years, where I joined one of the first teams on Wall Street to develop electronic solutions for Listed Derivatives. At the time I was running the Americas Product Development for that team.
Next, I moved to Goldman Sachs (pre the financial crisis) to take on a larger global mandate within the GS Electronic Trading division, where we also started developing Algorithmic Trading solutions and related analytics.
Post the financial crisis, when the clearing mandate hit, I was entrusted with the management of the European Clearing business at Deutsche Bank, and six years ago I joined the Citi Clearing business, which I ended up co-running globally in addition to Listed Derivatives Global Electronic Execution.
Nick: How about you, Mike?
I started my career at Pershing and then moved to Merrill Lynch in 1989. Shortly after I joined, Merrill decided to build an international Prime Brokerage (PB) business to expand outside of the US. I spent years working on the build: clearing, custody, stock loan, stock loan margin, assets optimisation and collateral management, swaps, risk management — the list goes on.
In 2006 I moved into the business and held various roles before becoming EMEA Head of the PB Platform. In summary, I have spent 30+ years building and running Prime Brokerage services. I have loved every minute of it.
Nick: You both joined Copper in the first half of 2022. What convinced you to make the move?
Sabrina: A new challenge, an emerging and innovative industry, a huge leadership opportunity and a great team. I was drawn to the challenges the financial industry is facing: how to improve the post trade environment? How to be more collateral efficient? This role combines my three passions of tech, markets and leadership.
Mike: 2008 changed Prime business across The Street significantly. The early days of Prime were about innovation and building solutions for clients, as they were (and remain) at the centre of everything. The Global Financial Crisis rightly drove higher levels of regulation and most PB’s spent all their time and budget on regulatory change, which continues to this day. It is expensive and extremely hard to deliver when businesses are running at scale on old tech stacks.
Then you look at Digital Assets. The more you understand the technology, the more you realise finance is at a crossroads — and technology eventually always wins. Drawing on my experience, I am happiest when I can innovate and deliver solutions for clients. Finally, I am privileged to count some of the smartest minds in the world as clients. If they are focused and making big bets in the Digital Asset space, why would I bet against them?
Nick: Mike, you brought a team over from Bank of America (BofA) Securities. Tell us more about them.
Mike: My experience in Prime taught me some fundamental principles:
Some examples of the expertise I have been fortunate enough to bring on board at Copper:
Blending the above with Copper’s existing and deep bench of Digital Asset and traditional finance expertise and it is starts to feel like the best mix of innovation and experience that I have ever seen come together to deliver for clients.
Nick: Sabrina, in your role as Chief Operating Officer, how are you building best practice in the organisation? Where are you focusing?
Sabrina: My team spans risk, security, operations, legal and compliance, and people. My role is really focused on enabling the organisation to sustain its growth, build the scale foundations and focus on compliance in the broad sense. This includes:
Nick: It’s great that you bring this broad and deep expertise from traditional finance, what about the expertise in Digital Assets at Copper?
Sabrina: We stand at the intersection of traditional finance and digital assets, absolutely. Our office is a real blend of these worlds, enabling us to cross-train each other. We have a real culture of learning. I am sure Mike feels the same when I say I am learning every day from our crypto experts such as and our CEO himself!
Having spent 20+ years in capital markets, what I can say is that much of the infrastructure, process, regulatory requirements and client needs are the same in the digital world. The technology and the assets are different, but the fundamentals, such as protection of client funds, providing effective access to liquidity, and ensuring clients have access to the trading tools they need are principally the same. I believe my team’s knowledge in these areas are some of the key strengths we bring to Copper and part of the reason I love working here.
Mike: I’d definitely say there’s a good balance between TradFi and crypto in the firm. We look for proven experience in digital assets for institutions in our hiring and fast-track learning programmes when people join. We’re building one culture, underpinned by excellence in process, operational security and so on.
Nick: Where do you see the institutional Digital Assets market one year from now?
Sabrina: In my view we will see the following by this time next year:
Mike: In my opinion we will see more focus on exchange standards and security. We are already seeing exchanges creating proof of reserves documentation to reassure their clients, of which the institutional side makes up a large portion of their assets under management. Solutions such as ClearLoop will come to the fore by offering a crucial additional layer of confidence to both clients and exchanges for their institutional clients.
Although unfortunate for those who lost out when FTX collapsed in November, it has demonstrated the importance of additional external protections via Digital Asset custodians such as Copper. I expect this to be a trend that looms large in 2023.
Nick: Speaking of the future, let me put this to you. In a recent about FTX by Justina Lee at Bloomberg, it talked about how the collapse was a threat to the current exchange-centric model. Sam Bankman Fried (SBF) wanted tradfi futures to look like crypto, but crypto might end up looking like tradfi instead. What are your thoughts?
Mike: It’s clear that no one entity can be a one-stop-shop for both custody and trading needs. This separation, conceptually like the segregation of Church and State, between trading services and custodians has been a long-established part of traditional financial markets. Longstanding structures like this are longstanding for a reason, and principally they help to avoid mismanagement and fraudulent activity — something that regulators take very seriously. I expect to see the crypto markets start to converge with these ideals as institutional finance becomes more involved in digital assets
Sabrina: The crypto market is still very nascent and in order to grow it will need to take lessons from the traditional finance markets. In part this will come from the emergence of firms such as Copper that are attempting to bridge the two financial sectors by bringing regulatory and risk management standards to the new space. In short, I think integration between the two is still a work in progress but that bringing them together will bring benefits to both.