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Citadel Securities’ Business Head Nazarali Leaves for Joint Crypto Venture With Virtu

Citadel Securities is investing in and developing its crypto product with help from Virtu Financial Inc., Charles Schwab Corp. and Fidelity Digital Assets.

(Bloomberg) -- Citadel Securities’ global head of business development, Jamil Nazarali, is leaving to head a joint venture the firm is building that’s intended to increase investors’ access to cryptocurrency. 

Nazarali, 54, was named chief executive officer of the platform the company is creating with Virtu Financial Inc., Charles Schwab Corp. and Fidelity Digital Assets, according to an internal memo seen by Bloomberg. He starts next week and will transfer his current responsibilities to Chief Operating Officer Matt Culek, Citadel Securities said in the memo. 

Citadel Securities is investing in and developing the crypto product with help from several market makers and brokerage firms, Bloomberg reported earlier this month. Sequoia Capital and Paradigm, venture capital firms with extensive interests in crypto and backers of Citadel Securities itself, are also partners on the project. 

“Under Jamil’s leadership, this new marketplace will bring together the best of what is new in crypto with what has been proven to create better outcomes in traditional markets,” Chief Executive Officer Peng Zhao said in the Tuesday memo.  

A representative for Citadel Securities declined to comment.  

The company is moving deeper in digital assets even amid industry staff cuts and a plunge in prices that’s being called a “crypto winter.” But Wall Street and many investors have been growing more comfortable with crypto in recent years, prompting firms such as Citadel Securities to embrace the asset class.

Still, the firm says it’s remaining cautious. There are “challenges and risks involved in participating in today’s crypto markets as a result of regulatory uncertainty, conflicts of interest, inconsistent asset safekeeping and poor vetting of counterparties,” Zhao said in the memo. 

Its partner on the project, Virtu, also sees a need to enter the space. “I don’t have a view on crypto, and frankly I don’t need one,” Virtu CEO Doug Cifu said at an event hosted by Piper Sandler this month. “There is an intense demand, especially from retail.”

Larger, institutional investors have a desire to enter into crypto in a more meaningful way, but there are still regulatory issues and concerns with the existing ecosystem, said Cifu. “Institutions should feel good about what they’re doing and have confidence in the marketplace,” he said.

Best Practices

The new venture will work with other industry leaders and regulators to establish best practices that address security constraints and other concerns that are keeping certain investors away from crypto, Zhao wrote in the memo. Investors in digital assets typically use exchanges such as FTX Trading Ltd., Coinbase Global Inc. or brokerage apps such as Robinhood Markets Inc. 

Nazarali, one of Citadel Securities’ most senior and longstanding employees, was previously head of Citadel Execution Services and an adviser to the firm. Later, as global head of business development, Nazarali managed relationships with exchanges and other key business partners. He previously led electronic trading at Knight Capital Group.

Citadel Securities has grown from a small group built alongside Ken Griffin’s multibillion-dollar hedge fund into a global trading behemoth. Today it’s a market maker in equities, options, Treasuries and ETF trading that rakes in billions a year. The new venture is its first entry into cryptocurrencies, which it previously shied away from. 

Read More: Citadel Securities Opens Up After Record $7 Billion Windfall

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