The crypto industry, myself included, loves its bridge metaphors.
As my guest on this week’s podcast puts it: "everyone talks about being the bridge between TradFi and DeFi... the bridge, the path, the stream, whatever you want to call it."
But here's the thing: GenTwo has actually built it.
For more on GenTwo: gentwo.com
For more on GenTwo’s digital offering: gentwo.com/digital-investors
While the crypto world has matured dramatically – with Bitcoin ETFs, regulated custody solutions, and literally dozens of Swiss banks now able to hold digital assets – there's still a massive access problem.
Traditional institutions want in, but Basel III requirements can demand up to 1,200% risk-weighted asset reserves for on-balance sheet crypto holdings. That's not just expensive; it's prohibitive.
This week I sat down with Mark Arasaratnam, the newly appointed Managing Director of GenTwo Digital, to understand how he and his team are solving this puzzle. What emerged was a masterclass in practical financial engineering – taking GenTwo's proven securitization platform and applying it to crypto's unique challenges.
As Mark explains, GenTwo is not trying to revolutionize the system. They're making it work better: "We're able to create securitized vehicles which make it easier for institutions to get into the space." No wallets required. No blockchain expertise needed. Just familiar securities with Swiss ISINs that slot right into existing portfolios.
Episode Highlights:
The "three C's" that keep institutions out of crypto: compliance uncertainty, operational complexity, and custody challenges – and how securitization addresses each one
Why off-balance sheet structures matter: How bankruptcy-remote SPVs eliminate the Basel III capital requirement problem while maintaining full asset backing
From simple baskets to exotic structures: Creating everything from basic crypto trackers to sophisticated products like accumulators and barrier reverse convertibles
The institutional crypto toolkit expanding beyond spot: Moving from cash (USDT/USDC) to money market funds to private credit opportunities
Real-world implementation with EDG: How a crypto derivatives broker uses GenTwo's structures to wrap complex strategies into bankable securities
Switzerland's crypto advantage: 34 banks with digital asset custody capabilities creating natural demand for institutional-grade products
The tokenization opportunity: Using GenTwo's SPV structures as the foundation for 24/7 settlement and T+0 trading
Why full decentralization might not be the endgame: "People want the decentralized nature of it until something bad happens to them"
About Our Guest: Mark Arasaratnam is Managing Director of GenTwo Digital, the digital assets arm of GenTwo. His path to crypto came through traditional markets – starting as a high-frequency equity trader before moving through FX global macro, ad tech, and fashion tech ventures. He was previously Co-Head of Digital Assets at Merris, where he created structured products linked to crypto. A 2017 crypto convert who came to Switzerland six months ago, Mark brings both trading floor pragmatism and entrepreneurial thinking to the challenge of institutional crypto adoption.
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