Introduction

“I think there are a lot of zombie exchanges still, and we don’t trade on a lot of them because we think a lot of them are zombies.”

Evgeny Gaevoy, Founder and CEO of Wintermute (Source: Chopping Block Podcast).

The crypto industry is rife with tales of rags to riches, as well as riches to rags. The same is true with exchanges. In 2022, many participants were found to be over-levered and insolvent as asset prices fell. BlockFi, Celsius, and most significantly, FTX were among big consumer-facing names that went bankrupt. Many of these companies were insolvent months before it became public knowledge.

This report looks at historic and recent CEX flows from one of the most prominent market makers in crypto - Wintermute....