Original Title: "Who is the New Ethereum Whale Abraxas Capital? Accumulated Over 270,000 ETH in One Week, Tether's 'Mysterious' Major Client"

Original Author: Nancy, PAnews

Recently, Bitcoin and Ethereum have driven the crypto market to a significant rebound, with increased market liquidity and frequent movements of large whales. Among them, London-based asset management company Abraxas Capital has become a focal point in this rebound due to its frequent on-chain operations and heavy allocation in Ethereum DeFi strategies.

Accumulated Over 270,000 ETH in One Week, Focused on Ethereum LST Ecosystem

In recent periods, Abraxas Capital has been actively operating on the blockchain.

Overview of Asset Holdings of an Open Address of Abraxas Capital

According to Arkham data, as of May 20, the total value of crypto assets held by two related public addresses of Abraxas Capital exceeded $1.15 billion, with cumulative profits of approximately $280 million.

From an asset structure perspective, besides over $190 million in Bitcoin, Abraxas Capital's investment portfolio is highly concentrated in the Ethereum Liquid Staking Token (LST) sector, used for staking or collateral in various DeFi protocols. Its main holdings include AwETH, wstETH, awstETH, and weETH, among which AwETH and wstETH combined hold more than $700 million, accounting for the majority of its overall assets. These assets combine on-chain staking returns with secondary market liquidity, reflecting Abraxas Capital's strategy of balancing stable returns with flexible portfolio adjustments.

From the perspective of capital growth, since mid-February 2025, the scale of the institution's assets has significantly accelerated, and it once broke through the $1 billion threshold. In just the past week (May 13–20), its net assets increased by over $130 million, mainly due to a significant increase in the AwSTETH (Aave v3 wstETH) position, with an added value exceeding $120 million.

In terms of fund flows, within the past 7 days, Abraxas Capital has withdrawn nearly 270,000 ETH from CEXs (centralized exchanges), completing an average of 6 buy transactions per day, with a total value exceeding $690 million. Calculating at an average purchase price of $2,573.8, compared to the current ETH market price of about $2,500, this position is currently in a temporary unrealized loss of approximately $11 million.

Notably, Abraxas Capital has significantly reduced its Bitcoin holdings within a month. On-chain data shows that over the past few weeks, the institution has transferred 2,000 BTC to exchanges, worth over $190 million. However, recently, it has begun re-purchasing Bitcoin, withdrawing approximately $85 million worth of Bitcoin from exchanges.

According to Arkham data, the ETH funds of Abraxas Capital are mainly directed towards Ethereum DeFi protocols. Within the past 7 days, Abraxas Capital has deposited over 174,000 ETH into mainstream DeFi protocols such as Aave, Ether.fi, and Compound, with an estimated total value of about $440 million at current prices. In particular, Aave is the primary use for Abraxas Capital's ETH holdings, and currently, it holds over $480 million in positions on AAVE V3.

From this, it can be seen that Abraxas Capital is becoming one of the more active and heavily allocated institutional players in the Ethereum ecosystem, and is strengthening the liquidity and yield reuse of its assets by deeply participating in the DeFi market.

Asset Size Exceeds $3 Billion, Previously a Major Client of Tether

Abraxas Capital Management is an asset management company based in London, regulated by the UK Financial Conduct Authority (FCA), aiming to build a top-tier asset management institution. The company was jointly founded by Fabio Frontini and Luca Celati in 2002, and both founders previously served as executives at London Dresdner Kleinwort Wasserstein (DRKW).

Abraxas Capital initially focused on traditional finance. On-chain data shows that the company had already started allocating Bitcoin assets by the end of 2014. In 2017, Abraxas Capital announced a shift in business focus to digital assets. Heka Funds is the core investment platform of Abraxas Capital specializing in digital assets, headquartered in Malta, and regulated by the Maltese Financial Services Authority (MFSA), with an asset size exceeding $3 billion.

As a multi-fund investment company, Heka currently manages three main funds: Elysium Global Arbitrage Fund, launched in 2017, is the first officially licensed and operational digital asset fund in the EU, achieving a return of 214.95% since its inception. As of the end of 2024, its asset under management has surpassed 1.2 billion euros; Alpha Bitcoin Fund, established in 2022, focuses on Bitcoin investments, with a current management size of $2 billion; Alpha Ethereum Fund, established in 2023, focuses on Ethereum, with a current asset under management of $4.8 million.

Among these, the Elysium fund is the main business of Heka Funds. It initially entered the market with a Bitcoin arbitrage strategy, inspired by a small arbitrage fund that purchased Bitcoin at a low price on Western exchanges and resold it on Japanese exchanges. Initially, Elysium primarily engaged in Bitcoin arbitrage, but as the arbitrage space gradually narrowed, the fund's strategy shifted toward stablecoin arbitrage.

In 2019, Fabio Frontini first met Tether's Chief Financial Officer Giancarlo Devasini and was invited to the Bahamas to meet Tether's banking partner Deltec Bank. According to Frontini's recollection, Deltec showed him Tether's asset proof: over 60% of reserves were cash, with the rest being short-term U.S. Treasury bills, which gave him full confidence in Tether's 1:1 backing. Afterward, Heka Funds verified Tether's liquidity through a series of small test transactions, gradually increasing the transaction volume.

Through continuous trading and cooperation, Heka Funds gradually became one of Tether's largest institutional clients, and it can be said that Heka Funds was also a driving force behind Tether's rapid development. According to a report published by Protos in 2021, Heka Funds received over $1.5 billion in USDT at that time, accounting for approximately 1.5% of Tether's total issuance. That year, Heka Funds accumulated approximately $52 million in profits, far exceeding the $5.8 million profit made by its parent company Abraxas, becoming one of the most successful funds within the group. In the past 30 days, Arkham data shows that among Tether's main trading counterparts, Heka Funds' transaction amount reached $564 million, ranking eighth.

In an interview in early 2025, Frontini again publicly expressed his confidence in Tether. He pointed out that Tether is earning significant interest rate spreads in the U.S. high-interest environment, and its business model is very simple yet extremely effective. He also cited comments from Howard Lutnick (CEO of Cantor Fitzgerald) at the 2024 World Economic Forum, stating that Tether's assets are mainly held by Cantor, the largest U.S. government bond broker, further enhancing his confidence in Tether.

Notably, at the beginning of this month, on-chain analyst @DesoGames tracked the flow of funds within a certain period of Tether and found that they mainly flowed to Abraxas and Cumberland crypto entities. However, the funds went through complex and opaque account layers, possibly to conceal the source of illegal transactions. The analyst further disclosed that HEKA Funds claimed its net assets were 1.3 billion euros, but bought 1.5 billion USDT (Tether issued approximately 2.5 billion in this period), which clearly exceeds its financial capacity, raising doubts. Additionally, the shareholders and directors of HEKA Funds were found in offshore leak databases, with complex backgrounds and difficult-to-trace identities. HEKA Funds may be a shell fund used by Abraxas to conceal its real activities, lacking transparency and credibility.

Currently, from on-chain movements, as the crypto market continues to become more financialized and the early stablecoin arbitrage space gradually narrows, Abraxas Capital is also exploring expanding its strategy to a more sustainable Ethereum staking and lending ecosystem.

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