Borderless Capital, an investment firm that specializes in web3, announced Tuesday that it is acquiring CTF Capital, a quantitative trading and asset management firm headquartered in Miami, with technology and operation teams in Latin America. The financial details of the deal were not disclosed. The deal marks Borderless’ first acquisition since its inception in 2018.
With this acquisition, Borderless Capital will add AI-infused quant trading expertise to its own business. The deal also marks the firm’s geographic expansion into Latin America, with plans to set up a new office in Argentina, one of the leading hubs for technology innovation in web3, in the second quarter of this year.
CTF Capital built trading models and capabilities that levered artificial intelligence (AI) and machine learning (ML) strategy engines; automated market making (AMM), a decentralized exchange that uses algorithms to trade digital assets; and maximal extractable value (MEV) strategies. The MEV strategy allows block miners to profit from transaction order manipulation in decentralized finance. In the quickly moving web3 world where tokens and blockchains can rise and fall rapidly, being able to trade nimbly is critical for any investing firm with a crypto focus.
After combining with CTF Capital, Borderless will have over $500 million in assets under management (AUM). Borderless manages six funds, including a $50 million cross-chain fund and Algorand Fund. All the existing funds managed by CTF Capital will be merged into Borderless’s Multi-Strategy Fund V LP., launched last year with $100 million under management today. The multi-strategy fund is “an open-ended hedge fund focusing on creating risk-adjusted maximum returns for investors in both liquid digital assets and soon-to-be liquid digital assets.”
CTF’s whole team, 11 staff, including two partners, joined Borderless Capital, which increased its total team to almost 40 employees after the acquisition.
“From a technology perspective, the team of CTF Capital has been working for over three years in developing their machine learning and AI-powered blockchain investments platform along with new innovative and emerging on-chain opportunities such as participating in the MEV, or maximum extractable value on-chain markets,” David Garcia, co-founder and managing partner at Borderless Capital, told TechCrunch.
Regarding financial capacity, Borderless expects to make synergies through the acquisition, which brings a new set of limited partners (LPs) from Latin America. It will help Borderless position the investment firm in the region and create new opportunities.
“Borderless already has significant exposure through several portfolio companies from this geography [Latin America]. On top of that, we have a vast list of investors and clients from Latin America, a lot of them that were part of CTF Capital Funds prior to the acquisition, and by opening a local office in the region [Argentina], we will be able to provide a better, more custom and direct service to them,” Garcia said.
Borderless Capital’s portfolio companies include Securitize, a digital tokenized securities end-to-end platform; Wormhole, a blockchain infrastructure company; Blockdaemon, one of Borderless’ first unicorns, a blockchain infrastructure company; and Helium Network, a decentralized physical infrastructure network that provides wireless connectivity for IoT devices and mobile devices.