Pat Larsen

@PatrickLarsen — Crypto trading platform displaying ETH flowing between wallet addresses

I got the chance to interview Karl Muth, CEO of They make enterprise grade, trading-desk-ready crypto software. Using their software, a trader can track large and subtle movements of crypto into various wallets and exchanges to get insight into which way the markets are moving. You can also tune your algorithms with their expansive data sets, which include annotated information back to block 1.

Karl holds J.D. and M.B.A. degrees, the latter with a concentration in economics from the University of Chicago, as well an M.Phil. and Ph.D. degrees from the London School of Economics. The founders of FRST brought him in as CEO earlier this year; prior to this, he was CEO of Chicago-based search engine startup Haystack, whose technology helps users find content on music, podcast, and video platforms.

FRST’s co-founders, Jonas Frost and Patrick Gorrell, decided to build because they saw that there was an incredible amount of valuable data in identifying and annotating the relationships between traders, nodes, mining sites, and other locations on the blockchain but no one was bringing it all together and making these connections available to traders in an actionable format. Jonas and Patrick wanted to answer some simple queries:

-How are the whales moving?

-How are the exchanges reacting to each other?

-What are the ICO’s doing with their ETH?

So, they built a platform to generate insights and then act on them.

The trading platform aims to be live by 1Q2019. They are also issuing a utility token that will grant certain levels of speed and access to the trading information. The token ticker is NDXX. There will not be an ICO; instead, the token will be distributed directly by FRST and via exchanges through a decreasing-discount presale model.

The Problems with Centralized Exchanges

The vast majority of trading today takes place on centralized exchanges. Karl sees three problems with centralized exchanges today, all of which have to do with efficiency.

  1. Costs are too high in crypto exchanges. You can see the transaction costs on traditional equities and commodities exchanges are much lower. So that needs to, and will, change.
  2. Crypto exchanges are price inefficient and that creates large arbitrage opportunities. You’ll often get large price differences between exchanges on any heavy trading day and that should, and will, get arbitraged away over time.
  3. Some exchanges are not able to handle their current trading volumes well and this problem will only get worse in the second half of the year as Karl anticipates higher trading volumes. Smaller exchanges that try to support their own market-making function are going to be increasing overwhelmed. There needs to be more investment in IT infrastructure and I think we’ll see more exchange activity like Bittrex without an intertwined market-making function.

So, what is something that is really hard to do but you can do it using the FRST platform?

Well, how about tracking ETH liquidations from the recent EOS event to see all the trading volumes, flows, and counterparties are and how they are related? Illustrating and interrogating these relationships is difficult with many of the tools out there.

Then we allow you to query the event itself as a window of time and understand which market participants were most active during the event and what market activity occurred during the event that was abnormal or unusual. You can see our interactive example chart of the EOS-ETH liquidation event here:


The function of historical research is handled on the platform through tracking every transaction on the ERC20 network, allowing people to query those transactions, and then also allowing people to see in a graph database the relationships between one wallet and another wallet, one node and another node, a fund and its mining operation, for instance. These relationships are incredibly important because they allow people to recognize who on the blockchain is related and distinguish related transactions from arms-length transactions.

FRST plans to have also bring in non-ERC20-conforming data in the future, but the platform does not currently support Bitcoin. Karl notes the team began with ERC20 because that’s the network with the most ICO activity.

Here is an example query “Show me all of the wallets on the ERC20 network that have ever had at least a million dollars in equivalent fiat value within them.”

In case you’re wondering what this query returns, the answer is a list of slightly less than half a million wallet addresses.

Granular Data

As Karl puts it, “We track every message ever sent, every transaction ever committed, and every token ever removed on the ERC20 network. What I mean by that is we have every time someone has transferred ownership of a Crypto Kitties. We have every time someone has made a transaction on the network that may not necessarily have dollar value, and we have, of course, trading activity. To the extent that spot prices are available for any given token, we provide them and we provide them synchronized to the right moment on the timeline. To the extent that a token is non-fungible or doesn’t have a dollar value, we alert the user to that fact. The user can exclude non-fungible tokens from the query or, for instance, exclude transactions worth less than a million dollars.”

Example Feature: Wash Detection

Do you want to know if the trading volumes on a particular ERC20 token are legit? Well, you can watch the wallets and see if they are trading just between each other. This will give you a good clue into which tokens and exchanges are above board and which aren’t.

Because the FRST platform depicts wallets in terms of clusters and lineages, it’s instantly apparent when transactions are within a family of wallets versus legitimate arms-length traffic. The tool can also suppress certain types of activity and certain types of wallets, avoiding related party transactions in volume calculations and only including clusters of wallets that traded at least a million dollars last quarter, for instance.

The Team

Karl says FRST’s team is a real differentiator, “Patrick and Jonas both come from a social influencer background, studying networks of people and content using bleeding-edge tools. I came from a search engine startup, where performance and accuracy are vital. We have other people working with us who are incredible, from architecture to dev, but it isn’t just the technical team that is strong; we just brought Meg aboard, who will be building key customer-facing and investor-facing materials. Even our new logo, Thundr Pup, is top-shelf work product, having been designed by Simon, who also designed Twitter’s bird logo and Github’s mascot, Octocat. What’s most exciting to me isn’t just the team’s credentials, it’s that everybody on the team understands what a trading floor looks like, what a trader needs, and what approaches and tools we need to be able to support; we understand our customers because every one of us lives their challenges, hears their needs, and sees their frustrations with the current tools available.”

Thundr Pup, FRST’s logo and mascot, was designed by Simon Oxley.

It’s pretty clear that we are very early in the game. Crypto and blockchain span the globe and so taxes, regulation, traditional tech and finance giants, economic shocks, and a number of other factors are going to help shape the path going forward. It’s great that we are seeing a lot talented teams building much-needed basic (and advanced) infrastructure.

You can follow Karl at @karlmuth on Twitter.

Author: Pat Larsen is an alum of the US Air Force Academy and Chicago Booth. He is a co-founder of, a cryptocurrency tax tool for individuals and CPAs. @patlarsen on Twitter.

More by Pat Larsen

Topics of interest

More Related Stories