Revaz (Rezo) Shmertz is the co-founder and Managing Partner of BR Capital, a digital asset investment firm, and the founder of Beyond Research Labs (BR Labs), which focuses on market infrastructure and execution.
In this interview, he reflects on how BR Capital's priorities have evolved, why liquid markets are taking on a larger role in the business, and what that shift looks like when research, engineering and trading all meet in a live market.
Venture is usually very popular in crypto, but the same isn't true of liquid markets, which tend to operate more quietly, under the radar. BR Capital seems to have shifted from venture to liquid. When did you realize that liquid strategies were the better fit for BR Capital?
Revaz Shmertz: BR Capital has combined venture investing with liquid asset management and active trading since its earliest days. Over the past couple of years, we have made fewer venture investments and focused more on liquid strategies. There was no single meeting at which we decided to switch businesses. The change developed gradually, becoming clearer in the second half of 2025.
By liquid strategies, I mean actively managing market-traded positions. The attraction for me is the work itself. Liquid strategies bring mathematics and infrastructure into direct contact with a market where hypothesis is challenged. That can be painful. It also makes the work dynamic in a way that suits me.
We still have a venture mandate. We have chosen to put more attention into liquid strategies because that is where we see the better fit for our capabilities.
Where a hypothesis meets the market
You've worked on both sides: venture investing and live trading. What feels fundamentally different about being right or wrong in those two environments?
R.S.: Venture and liquid strategies test an investor's judgment in very different ways. In early venture, the thesis is about a team and a market that do not yet exist in their final form. The investor makes a decision, and then the company does the work. Years pass, the company develops or it does not, and it is difficult even in hindsight to separate the quality of the original analysis from everything that happened after it. That is the nature of the asset, and it is why venture rewards patience more than precision.
And in liquid markets, do you get that answer much faster?
R.S.: A liquid strategy begins with a hypothesis about how a market behaves. That hypothesis has to be written down precisely enough to become rules, the rules have to become code, and the code has to execute against a live order book at the size we intend to trade. Every step is a place where the idea can turn out to be wrong: the mathematics can be sound and the infrastructure can fail; the infrastructure can be sound and the market can simply not behave the way the model assumed. The market is the final reviewer, and it does not argue. It returns a number.
Does that make the work more unforgiving because there's nowhere for a weak assumption to hide?
R.S.: That is the part of the work I find compelling. The research, the engineering, and the market are not separate activities with a handoff between them. They are one live system, and the person building it is accountable for the whole chain. When a strategy underperforms, the reason is somewhere in that chain and it can be found: a flawed assumption, a cost the model did not price, a regime the data did not contain or react to. The answer is rarely comfortable, but it is specific, and it feeds directly back into the next version of the hypothesis.
So does getting a clearer answer from the market actually make the job easier?
R.S.: None of this makes the work easier than venture. It makes it more exposed. A venture thesis can survive on conviction for a long time. A trading hypothesis cannot; it is either confirmed by the market or it is not, and the desk has to be built to act on either result.
Building within capacity limits
People often assume that if a strategy works, the obvious next step is simply to put more capital behind it. Why doesn't that logic hold in trading?
R.S.: The best-performing strategies in the history of trading share one inconvenient property: they do not scale. The funds that run them are, for the most part, impossible to get into. Some have been closed to outside capital for decades. Those that accept money or get freed up capacity do so with long lock-ups and firm caps on size, and the reason is not exclusivity for its own sake. Past a certain amount of capital, the strategy stops working.
What actually happens when a strategy starts running into that limit?
R.S.: This is what capacity means in practice. A strategy has a size at which it earns its expected return and a size at which its own trading begins to move the market against it. An asset having a quoted price is not the same as being able to enter or exit a substantial position at that price; beyond the quantity available at the best level, filling the order means paying up through the book, and the cost of that erodes exactly the edge the strategy was built to capture. Calling a market liquid does not remove that limit. It only changes where the limit sits.
Capacity, not ideas, is the main constraint on a good trading business. Ideas can be found. Room to deploy them at size is scarce, and it is where I see our opportunity.
So if capacity is the real constraint, where do you create more room to deploy capital without simply diluting the strategy?
R.S.: BR Capital and BR Labs have spent years in three markets that most participants treat as separate: traditional finance, centralised crypto exchanges, and decentralised protocols. Each has its own microstructure, its own sources of liquidity, and its own inefficiencies. A team that understands only one of them is limited to the capacity that one market can offer. A team that can move between them, pricing the same risk on a centralised venue and inside a DeFi protocol, understanding how the plumbing differs and where it connects, has a wider field on which the same hypothesis can work.
So where do you think BR Capital has the strongest edge today?
R.S.: That is where we think our capabilities fit. Not in a single strategy that scales indefinitely, because none does, but in connecting venues that others see separately, and in building the infrastructure to execute across them. That is a research and engineering problem before it is an allocation problem, and it is the part of the business where I want to put our attention.
From investing in a protocol to participating in it
What does that look like in practice? Is your involvement with CoW an example of that?
R.S.: Our involvement with CoW is one example of how investment and operating work can meet. BR Capital has backed CoW Swap. Through BR Labs, the separate research and engineering company I founded, we also participate in CoW Protocol with BRRRolver, our solver.
For someone who isn't deep into DeFi, what does a solver actually do?
R.S.: A solver is a professional executor that competes to carry out users' trading instructions. The user specifies an acceptable outcome, and the solver works out how to execute it. CoW Protocol's contracts enforce the user's signed constraints, including the applicable price and quantity limits.
What do you learn from actually operating inside a protocol that you wouldn't see purely as an investor?
R.S.: Alongside backing a protocol, we now do execution work inside it. That is a concrete expression of the investor-builder role: assessing a financial system while also building software that participates in it.
Where BR Capital goes from here
When you look at BR Capital from here, how much of this is an evolution of the business, and how much is a decision about what kind of firm you want it to become?
R.S.: Liquid strategies are where we are going next. This is not a hedge alongside the venture business; it is the direction we are taking, and our research, engineering, and capital will reflect that.
Venture is a part of how we arrived here. It gave the firm years of exposure to the protocols and teams that liquid strategies now operate in, and my own ten years in this market are part of why we see connections between venues that others treat as separate. If an opportunity appears where backing a protocol and building inside it are the same decision, as with CoW, we will take it. But we are not looking for the next venture portfolio. We are building a trading business.
That is harder than allocating capital and waiting. It is also where we think the work is.
Arman Shirinyan
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