SAINT HELIER, JERSEY – Your average cryptocurrency influencer’s target audience laps up the populist tropes of Bitcoin’s imaginary threat to the international financial system and other fake narratives that delight their countercultural sensitivities. Other cryptocurrencies borrow from the same superficially anti-establishment plot line to pump their own version of revolution, which was recently exposed as nothing more than an effective sales pitch to get a gullible and disaffected public to buy into their Ponzi scheme.
A string of massive cryptocurrency crashes in the spring wiped out trillions of dubious digital assets and opened the door for government regulatory agencies to step in and take the predictable step of institutionalizing digital currencies, as was always intended. The crypto bull market that began with the pandemic in early 2020 and propped up throughout by Michael Saylor’s Microstrategy – a Bitcoin fund masquerading as a technology firm – was given a final push by the GameStop incident in January 2021, which set the stage for a huge climb in crypto markets as the concocted legend of Reddit short squeeze heroes motivated many impressionable young adults to invest in digital assets.
Those who survived the slaughter will have no choice but to sit tight until the new institutional phase of the cryptocurrency market is in place to break even. Fortunately for them, signs of its arrival abound as the networks of institutional investors and crypto entrepreneurs that have been fomented since at least 2016 begin to bear fruit. Since that year, an “app for the hedge fund world” has brought wealth management executives from some of the oldest firms in Europe and offshore finance institutions together with crypto startup founders to hash out the details of the regulated digital multi-currency paradigm that is on the horizon.
For the vast majority of people who lost their shirts in the market-making phase, acceptance will eventually set in and most will realize that they were never actually ready to challenge the status quo, much less stage a revolution. At some point, they will follow in the footsteps of their Baby Boomer forebears and look upon their time posting online about ‘liberty’ and digitally-prescribed ‘sovereignty’ like their parents look back at Woodstock and self-serving notions of free love.
Managing the Risk Indicators
Non-members don’t seem to be privy to the meaning of the acronym, which appears nowhere on the organization’s website. All we know is that AYU is a “digital private members’ club” for “alternative investment professionals”, and aside from some vague descriptions about the association, membership requirements, perks and some fairly boilerplate corporate video fare, not much substance can be gleaned from the site. The mystery is no doubt deliberate given the nature of the business, which branched off the original networking concept for high net-worth individuals called HedgeBrunch.
Established in 2013, HedgeBrunch is a boutique networking event management agency geared towards hedge fund executives and asset managers. Despite catering to such a niche crowd, the UK-based concern nevertheless boasts over 12,000 members and organizes weekly private dining and cocktail events for its closely-held list of invitees. AYU is described as HedgeBrunch’s “sibling” company and hosts similar soirées for wealth managers looking to meet crypto entrepreneurs at some of London’s most exclusive venues, including a branded meet-and-greet called “Crypto Brunch“.
Angus “Gus” Morison is the founder of both HedgeBrunch and AYU. In 2017, he incorporated AYU Technologies, Ltd., to market a curated, invitation only social media app for the ultra-rich. Offering “up to the second industry news”, one-on-one communication between AYU members and “premium lifestyle perks” from the club’s sponsors, the 12-and-over rated app also teases “mild” sexual content, nudity and occasional references to drug use.
AYU/HedgeBrunch is Morison’s second foray into event management, with the first coming in 2005 when he co-founded a company with a German business partner, but it was dissolved only four years later, just as he was beginning a Masters program in Behavioral Finance at the University of Bath. Enrolling in 2009, he worked on his dissertation as an employee of financial services veteran, Nick Bullman, who would go on to partner with Bath’s School of Management and the University of Bristol to create a four-year program “to develop Network Credit Risk Model, Behavioural [sic] Risk Models and Portfolio Risk Analysis” – later becoming a more or less permanent, UK government-funded program in partnership with Bullman’s new company, CheckRisk.
Armed with knowledge of the “key indicators” Gus identified in his doctoral study and “how an understanding of them can help contribute to a proprietary investment risk profiling system,” Morison took his insights to Cardwell Investment Technologies in 2011. Cardwell had been established only a few years earlier as the subprime lending crisis was just getting underway and was among the first hedge funds that used automated trade execution software for futures trading relying on advanced statistical research. Such hedge funds are called ‘systematic’ or quantitative and use exactly the kind of proprietary investment technologies Morison studied.
Perhaps Gus is a social butterfly at heart and just couldn’t stay away from the party planning business, but after just two short years as Cardwell’s head of Marketing Morison moved on to create HedgeBrunch, accumulating a membership roll in the thousands within a few short years and living up to his reputation as the “business networking maven”. But having the gift of gab is one thing; getting in the room with fabulously wealthy institutional investors is another and more than likely a ‘perk’ provided by his partners in the venture.
Old Money, New Crimes
Before earning the reputation as one of the world’s busiest tax havens, Jersey’s claim to fame was a network of 25 tunnels the Nazis built between 1941 and 1945 to prepare for a British invasion that never materialized. Jersey has since played host to the UK’s most prestigious banking institutions, which run their offshore operations from the self-governing dependency of the British Crown, along with accounting behemoths like PwC and Deloitte that cook the books for all of them.
Former economic adviser to the Jersey government, John Christensen, famously pulled the curtain back on the massive levels of money laundering, market rigging, tax evasion, illicit arms trading and many other crimes that were rampant in the offices of the island’s offshore financial institutions. Working with the Wall Street Journal in 1996, Christensen exposed the vast concentrations of “hot money” moving through the system, which was calculated to be around $32 Trillion as late as 2019 across all such jurisdictions, including Hong Kong, Cayman Islands and the Caribbean. The Jersey native paid a price for his indiscretions and was run out of town in 1998 after a public relations firm retained by the Jersey finance industry mounted a smear campaign against him.
In 2001, the Jersey government established its own PR operation to counter the image problem in its critically important financial sector. Jersey Finance has seven offices around the world and works with every industry player on the island to make sure the right messages are disseminated. The government agency is listed as a HedgeBrunch partner and both the organization’s head of funds, Elliot Refson, and its business development director, Robert Moore, are AYU members.
According to an interview with Refson on HedgeBrunch’s blog, he is currently working on “a Jersey based ESG scheme” to pool money from wealth management fees to create “employment in Africa” through the Durrell foundation – a wildlife conservation trust run through the patronage of the Queen’s only daughter, Princess Anne. Royal connections tied to themes of impact investment are also present through AYU founder Morison, himself, who sits on the board of The Prince’s Trust RISE 2025. Prince Charles’ charitable organization is heavily involved in social impact projects throughout the Global South, with the RISE 2025 program specifically designed to create networks of social entrepreneurs.
AYU’s links to the shadowy world of private banking is underscored by the presence of another notable HedgeBrunch partner, Lombard Odier. Founded just a few years after the French Revolution, the Swiss bank is one of the oldest financial institutions in the world and, as of 2002, one of the largest asset management companies in Switzerland since its merger with Darier, Hentsch & Co. More significantly, Lombard Odier was among the handful of private banking firms that participated in the UN-sponsored incubator phase for microfinance and impact investment projects called BlueOrchard in the late 1990’s, pioneering the first “sustainable ESG analytical models” in 1997.
Home to hundreds of international Non-Governmental Organizations (NGO) that form the backbone of Atlanticist soft power projection and sustainable policy promoters in the Global South, Geneva was the “hatching” nest for the impact finance regime, which is in the process of supplanting the legacy development finance paradigm. Cryptocurrencies and so-called web3 technologies like DeFi are vital to its implementation.
Crypto Whale of a Time
According to a short piece published on the eve of AYU’s app launch, Morison recruited “2000 hand-selected founder members” to establish HedgeBrunch’s digital sister club. Among them was Dmitry Tokarev, the Serbian-born founder of a crypto custodial company called Copper Technologies, and former CTO of Dolfin Financial – a British wealth management firm that was shut down by the UK’s Financial Conduct Authority (FCA) after a probe revealed it be insolvent.
Tokarev, who founded Copper in the midst of Dolfin’s debacle is currently having his own issues with the FCA, which has placed the cryptocurrency company on a “temporary registration” list, withholding final approval for the firm’s operations in the UK, despite having former Chancellor of the Exchequer, Philip Hammond, on its board of directors. Hammond, who was brought on as a senior advisor for Copper in 2021, blasted the UK government’s snail-pace adoption of crypto-friendly legislation and responded to the FCA’s April decision with a threat to move the company to Switzerland.
Studying Risk Management and Financial Engineering at Imperial College after arriving in the UK, Tokarev decided to set up investment vehicles for Bitcoin in 2017. According to an interview with AYU, this led him to create an infrastructure layer for institutional investors to be able to trade digital assets securely and ultimately to the founding of Copper in 2018. As a “strong believer” in regulatory compliance, Tokarev is on the leading edge of bringing about the institutional phase of cryptocurrencies as the wildcatter era of digital money draws to a close.
Regardless of where Copper ends up running its servers, the incursion of institutional investors into the cryptocurrency space is beginning in earnest after the proof-of-concept, freedom token patsies step aside to make way for the big boys like Barclays Bank, which on Sunday announced its participation in Copper’s latest £2b investment round. Any questions the banking giant may have about the company’s prospects can easily be addressed by their former senior legal counsel and now Copper’s Chief Legal Officer, Carly Nuzbach Lowery, over mimosas and eggs benedict at the next AYU brunch. Better yet, a private one-on-one dinner date can be arranged through the AYU app, in case a few laws need to be broken along the way.