Battle for hottest talent in finance threatens to increase pay
2021 has been an excellent year for structured equity derivatives traders in banks. It's also been an excellent year for systematic traders in hedge funds who've been caught in hiring wars between the likes of Citadel and Balyasny, and for people working in electronic market making generally as the likes of Jane Street have upped their headcount. Equity derivatives traders excepted, many of these people can already move between banks, hedge funds, fintech and tech. In 2022 a big new sector threatens to squeeze their already short supply of talent even further: crypto.
Banks themselves are building out crypto and blockchain divisions: Citi is hiring 100 people; JPMorgan has 99 blockchain jobs open globally (including, curiously, several in a research and engineering team in Athens); Goldman Sachs is looking for digital assets engineers in Singapore, Hong Kong and New York. And the crypto native sector is hiring thousands - Crypto payments firm MoonPay wants to hire 200 people. As we reported last week, big players like Coinbase and Galaxy Digital have added hundreds in 2021 and plan to keep hiring in 2022.
Headhunters say crypto firms are chasing precisely the people that banks, electronic market makers and hedge funds also want to hire. The most in-demand at crypto market makers are, “those who have experience developing trading systems or strategies in highly volatile markets such as equities, options and FX,” says Jim Brownwood, who runs systematic trading and digital assets at The Omerta Group. Nor is there any likelihood of let-up in demand in 2022 if crypto prices slip: "There may be a market dip, but the firms that really understand the opportunity are clear that their time frames are years, not the next six months,” says Brownwood.
The upshot is that banks that want to retain some of their most desirable talent are facing competition from all sides. Top crypto firms are awash with cash: most will at least match salaries, and will pay bonuses in cash or tokens, sometimes several times a year.
Crypto firms are the "new talent drain" on banks, says one headhunter. "The big crypto players are hiring a lot of talent from the market," confirms another equity derivatives headhunter in London. "They've contributed to the turnover this year," he adds. Anis Akl, the former head of flow and derivatives trading at Credit Suisse, who runs market making firm CrypPro, says equity derivatives traders have the advantage of familiarity with popular crypto concepts and products like indices and baskets, derivatives and margining and structured products. "But an HFT guy, or commodities or FX trader is equally relevant," he says.
This year's moves out of banking and into crypto have included people like Konrad Laesser (ex-Goldman), Chris Perkins (ex-Citi), Kyle Downey (ex-Morgan Stanley), Min Clin (ex-Goldman Sachs), and Jonathan Cheesman (ex-HSBC).
Those who made the move from banking to crypto previously claim to be delighted with their new roles. "The energy is unbelievable and the pace at which we work is mind-blowing," said Brett TejPaul, the head of institutional sales, trading at Coinbase, and a former head of structured finance at JPMorgan and head of digital at Barclays in a recent interview with Heidrick & Struggles. Working at Coinbase is "fun" added TejPaul: "It reminds me of the first ten years of my career, when we were just running around and introducing new asset classes and structured products and new instruments to institutional clients." (There are also complaints about work-life balance at Coinbase, but TejPaul didn't mention this.)
Part of the crypto sector's appeal is this position on the cusp of banking and technology, says Brownwood. “Algorithmic quant researchers and engineers are typically interested in working in the most creative and collaborative environments," he claims. Another headhunter says some people in banks are still a bit uncertain about a crypto move, but that their uncertainty is waning: "Only around 50% of the people I speak to in banks are willing to make the move, but that's double the hit rate of last year."
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