Who is Abraxas Capital, the New Ethereum Whale?
Recently, Bitcoin and Ethereum have driven a significant rebound in the cryptocurrency market, with market liquidity increasing and whale movements becoming more frequent. Among them, the London-based asset management company Abraxas Capital has become a focal point in this rebound due to its frequent on-chain activities and heavy involvement in Ethereum’s DeFi strategies.
Accumulating Over 270,000 ETH in a Single Week, Focusing on Ethereum LST Ecosystem
In recent times, Abraxas Capital has been actively moving assets on the blockchain.
Abraxas Capital’s public address holdings overview.
According to Arkham data, as of May 20, the total value of crypto assets held by Abraxas Capital’s two relevant public addresses has surpassed $1.15 billion, with cumulative profits of approximately $280 million.
Looking at the asset structure, aside from over $190 million worth of Bitcoin, Abraxas Capital’s portfolio is highly concentrated in Ethereum liquid staking tokens (LST), which are used for staking or as collateral in various DeFi protocols. Its main holdings include AwETH, wstETH, awstETH, and weETH. Among these, AwETH and wstETH together account for over $700 million, representing the vast majority of its assets. These assets offer both on-chain staking rewards and secondary market liquidity, reflecting Abraxas Capital’s strategy of balancing stable returns with flexible rebalancing.
In terms of asset growth, since mid-February 2025, the institution’s asset scale has significantly accelerated, recently surpassing $1 billion. In just the past week (from May 13 to 20), its net assets grew by over $130 million, primarily driven by substantial increases in its AwSTETH (Aave v3 wstETH) position, with an additional investment of over $120 million.
In terms of fund flow, within the past seven days, Abraxas Capital has withdrawn nearly 270,000 ETH from centralized exchanges (CEX), completing about 6 buy transactions per day on average, totaling a value of over $690 million. At an average purchase price of $2,573.8, this portion of the position is currently in a temporary unrealized loss of around $11 million, compared to the current market price of around $2,500 for ETH.
It is worth noting that Abraxas Capital has significantly reduced its Bitcoin holdings within a month. On-chain data shows that in recent weeks, the institution has transferred 2,000 BTC to exchanges, worth over $190 million. However, it has recently started to rebuild its Bitcoin position, withdrawing around $85 million worth of Bitcoin from exchanges.
According to Arkham data, the ETH funds from Abraxas Capital have mainly flowed into Ethereum DeFi protocols. In the past seven days, Abraxas Capital transferred over 174,000 ETH to major DeFi protocols such as Aave, Ether.fi, and Compound, with an estimated total value of about $440 million at current prices. Particularly, Aave serves as the primary use case for Abraxas Capital’s ETH holdings, with a position worth over $480 million on AAVE V3.
It can be seen that Abraxas Capital is becoming one of the most active and heavily invested institutional players in the Ethereum ecosystem, strengthening asset liquidity and yield reuse by deeply participating in the DeFi market.
Asset Size Over $3 Billion, Once a Major Client of Tether
Abraxas Capital Management is a London-based asset management company regulated by the UK’s Financial Conduct Authority (FCA), aiming to create a top-tier asset management institution. The company was co-founded in 2002 by Fabio Frontini and Luca Celati, who previously held senior positions at London’s Dresdner Kleinwort Wasserstein (DRKW).
Initially focusing on traditional finance, Abraxas Capital began its Bitcoin asset strategy as early as the end of 2014. In 2017, Abraxas Capital announced it would shift its business focus towards digital assets. Heka Funds, the core investment platform focusing on digital assets, is a subsidiary of Abraxas Capital. Headquartered in Malta and regulated by the Malta Financial Services Authority (MFSA), Heka Funds manages assets over $3 billion.
As a multi-fund investment company, Heka currently manages three major funds: the Elysium Global Arbitrage Fund, launched in 2017, which is the EU’s first officially licensed digital asset fund, and has achieved a return of 214.95% since its inception. By the end of 2024, its assets under management exceeded 1.2 billion euros; the Alpha Bitcoin Fund, established in 2022, focuses on Bitcoin investments, with current assets under management of $2 billion; and the Alpha Ethereum Fund, launched in 2023, focuses on Ethereum, with current assets of $4.8 million.
Among these, the Elysium fund is the main business of Heka Funds. Initially entering the market with a Bitcoin arbitrage strategy inspired by a small arbitrage fund that bought Bitcoin cheaply on Western exchanges and sold it on Japanese exchanges, Elysium started with Bitcoin arbitrage. However, as the arbitrage opportunities narrowed, the fund gradually shifted its strategy towards stablecoin arbitrage.
In 2019, Fabio Frontini met with Tether’s CFO Giancarlo Devasini and was invited to the Bahamas to meet with Tether’s banking partner, Deltec Bank. According to Frontini, Deltec showed him Tether’s asset backing, with over 60% of its reserves in cash and the rest in short-term U.S. Treasury bonds, which gave him full confidence in Tether’s 1:1 backing. Subsequently, Heka Funds verified Tether’s liquidity through a series of small test transactions and gradually expanded its trading volume.
Through continued trading and cooperation, Heka Funds gradually became one of Tether’s largest institutional clients and can be said to have been a key driver in Tether’s rapid development. According to a 2021 report by Protos, Heka Funds had acquired over $1.5 billion in USDT, accounting for about 1.5% of Tether’s total issuance. In that year, Heka Funds earned around $52 million in profits, far exceeding the $5.8 million profit of its parent company, Abraxas, making it one of the most successful funds within the group. In the past 30 days, according to Arkham data, Heka Funds’ trading volume among Tether’s main counterparts reached $564 million, ranking eighth.
In an interview with Protos in early 2025, Frontini once again expressed confidence in Tether. He pointed out that Tether was earning huge interest income in the U.S. high interest rate environment, and its business model was simple yet highly effective. He also cited a comment by Howard Lutnick (CEO of Cantor Fitzgerald) at the 2024 Davos Forum, noting that Tether’s assets are primarily held by Cantor, the largest U.S. Treasury bond broker, further boosting his confidence in Tether.
It is worth mentioning that earlier this month, on-chain analyst @DesoGames tracked Tether’s fund flows over a certain cycle and discovered that most of it flowed into Abraxas and Cumberland crypto entities. However, the funds were routed through multiple accounts in a complex and opaque manner, likely aimed at concealing the source of illicit transactions.
The analyst further disclosed that Heka Funds claimed to have net assets of 1.3 billion euros but had purchased $1.5 billion worth of USDT (with Tether issuing approximately $2.5 billion during this cycle), an amount clearly beyond its financial capacity, raising suspicions.
At the same time, Heka Funds’ shareholders and directors were found in offshore leak databases, with complex backgrounds and difficult-to-trace identities. Heka Funds may be merely a shell fund used by Abraxas to hide its true activities, lacking transparency and credibility.
Currently, from on-chain movements, as the crypto market continues to financialize and the early stablecoin arbitrage opportunities gradually narrow, Abraxas Capital is also exploring expanding its strategies into more sustainable Ethereum staking and lending ecosystems.
This article is a collaborative repost from: PANews