Wintermute founder responds to market manipulation allegations: If you treat me as a hypothetical enemy, don’t blame me for attacking you

Source: Evgeny Gaevoy, Founder and CEO of Wintermute

Compiled by: Azuma, Odaily Planet Daily

This article is a personal piece written by Evgeny Gaevoy, the founder and CEO of Wintermute, a few days ago.

In the article, Evgeny Gaevoy provides a detailed response to the community's recent doubts about Wintermute's operational pricing and accusations of harvesting retail investors. Unlike some other public figures who generally adopt a calmer tone in their responses, Evgeny Gaevoy delivers a strong rebuttal throughout, even using profanity, but clearly addresses the related doubts by deconstructing Wintermute's business logic.

Below is the full text by Evgeny Gaevoy, compiled by Odaily Planet Daily (with some omissions).

Recently, X (Twitter) has been particularly "lively," with some people's understanding of market mechanisms reaching a new low. Although I have explained Wintermute's business model and operational style multiple times in the past, it is now necessary to go through it again.

This is not an apology statement

We do not need to please those "keyboard warriors" who shout all day on social media. We are indeed trading with these people on exchanges (whether CeFi or DeFi), but essentially, everyone is still in a public environment taking what they need. This post may help a few understand the true work of Wintermute (and other low-profile proprietary trading firms), but to be honest, I don't hold out much hope—after all, most retail investors don't even understand that "uninformed flow" (referring to trading behavior lacking market information or professional judgment) is our main source of profit.

This article is written for those true partners—project parties, OTC counterparts, exchanges, and occasionally passing regulators.

About my social media style

I have been quite active on X in recent years, and my speaking style is indeed a bit abstract (even our own employees sometimes can't understand those memes).

I enjoy playing with memes and accept being the subject of them; for example, the recent various meme about K-line charts crashing is quite interesting. If you took it seriously, that's your own problem; a sense of humor is a basic human quality, and if you lack it, then I'm sorry.

If you think it's unkind to joke about those "unlucky ones who got liquidated on xxx"…… I can only say welcome to the craziest casino in history; adults should take responsibility for their choices.

We are not a charity

Like all other proprietary trading firms, Wintermute's goal is to make money through trading; we are not a charity. More specifically, our core business is digital asset trading. Therefore, we are not only interested in profiting from as many opportunities in the market as possible but also very interested in the sustainability, development, and growth of this field. Since 2020, our venture capital department has been investing in cryptocurrencies and has never net shorted. Our cryptocurrency exposure has always accounted for 20% to 30% of our net assets.

Saying we short the market is pure nonsense. During the Luna crash, 3AC's collapse, and FTX's bankruptcy…… we lost more during these black swan events than we made, not to mention the long market winter that followed.

What exactly does Wintermute do?

Our core business is DeFi, CeFi, and OTC—our operations are more diversified compared to most competitors. We switch battlefields according to market hotspots, welcoming BTC, ETH L2, Meme, AI, and more.

• CeFi Market Making: We place orders for hundreds of assets on over 50 exchanges like Binance and Coinbase, making money from the bid-ask spread. In a bull market, we profit from active trading volume, while in a bear market, we compete with other market makers to "harvest." We also run so-called "market-making" strategies, which allow us to arbitrage between different platforms and outsmart those slow-reacting, foolish market makers.

• DeFi Arbitrage: We provide liquidity on 1inch, Jupiter, and Bebop, arbitrage on Uniswap, execute liquidations on Aave and Morpho, and market make on Hyperliquid. We are definitely experts in this area.

• OTC Trading: Our coverage is extensive, whether in terms of the number of tokens or types of trades (spot/contract/options). We expand our business through better technology rather than a larger sales team.

All of the above operations maintain delta neutrality. This means that if we sell an asset on Binance, we will simultaneously look for the best price to buy it back from all available liquidity sources. OTC trading may take longer to balance, especially when trading long-tail assets, but our ultimate goal is also to achieve risk neutrality.

We occasionally take proactive bets on market direction, but the positions are small and not held for long. The vast majority of our proactive operations are long, such as buying on dips or purchasing locked tokens at a significant discount, although we do short occasionally, this is rare—because some junk coins may suddenly surge 500%, making the shorting risk too high.

Why do tokens drop?

Now let's talk more specifically about why prices drop, especially why prices may still drop after a token is market made by Wintermute or listed on Binance.

Macro Environment Impact

The recent two crashes stem from traditional financial markets (DeepSeek breaking AI value logic, tariff impacts). The crypto market is now highly correlated with the US stock market (Nasdaq drops → BTC drops → SOL drops → meme crashes); to become a more successful trader, one should understand that our small cryptocurrency market now has a very direct connection with the outside real world. Of course, you can also ignore this information and choose to believe that Wintermute and Binance are up to some conspiracy. Good luck, and continue to be poor.

Supply and Demand Imbalance

The higher the liquidity of a token, the easier it is to sell. When a token is listed on Binance or when Wintermute starts market making, the liquidity of the token increases, making it easier for early holders to sell and cash out. If the project itself lacks ongoing appeal, the price will naturally drop. If you still haven't figured this out and prefer to blame your trading skill issues on exchanges and market makers, then I can only wish you good luck again.

Market Making Agreement Terms

Some token projects embed call options in their agreements with market makers, allowing market makers to sell when the token price exceeds the strike price (which is usually much higher than the price when the market maker participates). This indeed affects market fairness. I believe the industry needs more transparency, but the disclosure rights lie with the project parties.

Quick Q&A

Finally, here are some answers to common community questions.

About "hunting" stop-loss orders

We do not "hunt" stop-loss orders. Perhaps we should, but I have always felt this is a high-risk business, so it's better not to touch it.

About price manipulation

Sigh, we do not manipulate prices. First, we don't know how to manipulate; second, our core business is profitable enough, so we wouldn't do illegal stupid things; third, I live in London and enjoy traveling to the US, so I don't want to move to Dubai.

About on-chain transfers

This is just rebalancing across different platforms. Sometimes, AMMs may show some K-lines that look like Christmas trees; that’s evidence of our arbitrage between CeFi and DeFi.

About the so-called Luna manipulation video

It's just edited out of context (with statements weeks or months apart); you can keep posting, and I will continue to ignore it.

About private messages

Don't DM me asking for trades; I will not respond (except for West Ham fans), and all related chat records are photoshopped.

About joking about crashes

I reserve the right to continue making jokes.