Talking Crypto with Hehmeyer’s David Nuelle

Hi David, thank you for speaking with us. In your words, what went into the decision to reinvent Hehmeyer and focus on the crypto space?

It was the opportunity — when we looked at the opportunity set, we realized how large it was in digital assets. We’re at a very early stage of the shift to digital assets, and it’s going to be broadly appealing.

After all of the boom and bust of the past few years, what makes now a particularly notable time for cryptocurrencies?

There’s an evolution of cryptocurrency — this is something where Global DCA will be impactful — from an unclassifiable asset into one that will be a true asset class. We’re in that transition period now. The U.S. Office of the Comptroller of the Currency (OCC) allowing banks to hold onto crypto is an informal greenlight for that. Foreign governments are making their own cryptocurrencies, you have Libra (which is under scrutiny, but my guess is Libra or something like it will evolve), and there’s demand from retailers and commercial actors and investors.

How did you get introduced to Global DCA?

I went to one of their events last year to see former Chicago Mayor Rahm Emanuel speak, and was really impressed by what they were doing and how they were organizing. So I volunteered for one of the committees, and I met people who bring a lot of firepower and are really knowledgeable. I felt like the mandate they put on themselves — to embody self-regulation in the crypto space and develop in-line with global best practice for Self-Regulatory Organizations (SROs) — is different than other organizations. It’s hard for me to know exactly what others are doing, but most are operating as trade organizations and less as full blown attempts to evolve into an SRO. Right now, as we transition to cryptocurrencies becoming a true asset class, that’s a needed role. Someone has to promote good conduct in the markets, to give legitimacy and lend some credibility to the market at a needed time.

Why does the crypto industry need Global DCA?

The group is extremely well organized — they put together a code of conduct that is well thought out and based on the experience of other industries, while focusing on the idiosyncrasies of the crypto market. I think that’s really the number one thing, bringing a sense of regulatory authority to a market where there’s a perception that it isn’t there.

What lessons should crypto learn from traditional capital markets? And, vice versa, what lessons can traditional capital markets learn from crypto?

A market thrives when it’s well-regulated and there’s fairness for all participants. The LIBOR/FX scandals of the ’90s and 2000s, for example, put FX in an unfavorable light and gave the industry a black eye. So the key for cryptocurrency is to establish a code of conduct and set of rules for the participants to avoid those same problems. If it operates in the shadows, it will never grow; if it operates in the sunshine, it will.

What are the biggest challenges facing the crypto space today?

The biggest challenge that the crypto industry will face is keeping up with growth of the demand side. We don’t really have a killer app yet — there are some looking promising, but once there is one and everyone wants it, I don’t know if crypto is well-equipped to keep up with that. In addition, many of the laws and regulations surrounding conventional markets need to be updated to address crypto.

What are three big industry changes you see in the upcoming years?

  1. I think you’ll see retailers start to adopt crypto services and tokens for their businesses. We’ve already seen this to some extent with Bakkt’s relationship with Starbucks — ultimately retailers will adopt it, driving mass adoption.
  2. I think there will be a number of innovations as it relates to ways you can transact crypto and crypto-related services. People will start to adopt smart contracts. They will proliferate, we will rely less on centralized authority and more on decentralized oracles in that space.
  3. I think you will see conventional banks offering the ability to hold crypto and fiat in one account, and that will be a breakthrough.

Any final thoughts as we wrap up this interview?

I hope people realize how quickly this industry can move and how big the opportunity set is. Someone told me a few years ago that we weren’t in the first inning with cryptocurrency — we were in the first strike of the first inning. It feels like we’re in the second inning now. The changes that cryptocurrency can bring are enormous and the benefits will be huge for a lot of people in the world.



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