Episode #35: Jennifer Liu

Episode 35

Banks and other institutions looking to enter the crypto space want security and regulation. Anchorage Digital offers both.

Anchorage is the first federally chartered crypto bank and offers institutions custody, staking, governance, trading and financing solutions for digital assets. Jennifer Liu, Anchorage Digital’s head of lending, talks with Bryan and Becca about what Anchorage does and how she envisions the future of finance.

Headshot of Jennifer Liu

Featured Guest: Jennifer Liu

Jennifer Liu leads the lending team at Anchorage Digital and has extensive experience in the financial services and technology industry. Prior to assuming her current position, she was Chief Financial Officer at Ledger Holdings Inc, a cryptocurrency exchange and clearinghouse regulated by the Commodity Futures Trading Commission (CFTC). As an executive at a highly regulated financial startup, Jennifer had to wear many hats, including conducting monthly financial reviews with the CFTC and managing the accounting, tax, treasury, business systems, financing, and capitalization table. Prior to this, she was a senior finance manager at Alibaba Group where she built out the finance function in North America following the largest global IPO in September 2014. Jennifer started her career on Wall Street, as an investment analyst at JP Morgan Asset Management specializing in technology and media investments and as an equity research associate at Morgan Stanley. Jennifer received a B.S. in Operations Research & Industrial Engineering and an M.Eng. in Financial Engineering from Cornell University. She is also a CFA charterholder.

Becca Hoeft

As a marketing, public relations and corporate communications leader, Becca (only her mom calls her Rebecca) started her career in consulting and has been involved with six startups ranging from film, fashion, technology and food, with her first startup being a social enterprise importing leather fashion accessories made by single mothers in Nairobi, Kenya. Speaking across the country, she is known for leading award-winning teams and has received recognition from the Cannes Film Festival for Best Media Campaign, Hermes, MSPBJ Women in Business, and most recently, the Top Women in Communications awards. When the day is done, you’ll find Becca behind a good travel book planning her next adventure, plunking a tune on the piano or laughing with her blended family.

Bryan Toft

Bryan Toft is Sunrise Banks’ Chief Revenue Officer. In this position, Bryan oversees commercial banking/lending, treasury management, mortgage and fintech partnerships. He has been with Sunrise Banks for more than a decade. From 2014-2017, he served as president and CEO of Community Bank Owatonna.

Bryan has held a variety of roles at Sunrise Banks including credit analyst, commercial loan officer and EVP regional manager of commercial lending in Minneapolis.

Bryan received a B.S. in Computer Science from Buena Vista University and an MBA from the University of St. Thomas. He is a board member of the Minneapolis Chamber of Commerce, Twin Cities Metro CDC and Charter School Property, Inc.

Featured Music

Ramona Woolf


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Episode Transcript


0:01 – Jennifer Liu

I believe in the future that there won’t be a distinction between traditional banks and like crypto native banks like us, because traditional banks, they are going to want to plug into services like us so that if you are a customer, you can choose to by fiat, you can choose to buy commodities, you can choose to buy Bitcoin, and it’s all within the safekeeping of your bank.

0:29 – Becca Hoeft

Welcome to the NextGen Banker podcast, where we explore what’s next in banking and talk with the innovators responsible for creating positive change in the financial sector. I’m Becca Hoeft, Sunrise Bank’s Chief Brand Officer, and I’m here with my colleague, Bryan Toft, Sunrise Bank’s Chief Revenue Officer. We are so excited to welcome Jennifer Liu to the show today. Jennifer, thanks for being on the podcast.

0:55 – Jennifer Liu

It’s a pleasure to be here.

0:57 – Becca Hoeft

All right, before we get started, just a reminder, stick around to hear our musical feature at the end of the episode. Each NextGen Banker episode showcases one new musical artist from somewhere around the world, representing a wide range of genres, so be sure to check it out.

1:15 – Bryan Toft

Now let’s hear about Jennifer, because she has a fascinating background. Jennifer is the Head of Lending at Anchorage Digital, which is a digital asset platform that includes a federally regulated crypto native bank. Jennifer also has experience as a senior manager of finance at Alibaba Group. And she worked at JP Morgan in asset management, and at Morgan Stanley. So, we’ve got a number of questions for you, Jennifer and let’s get to it, Becca, you want to lead us off?

1:39 – Becca Hoeft

Yeah, of course. All right, Jennifer, you have this really interesting background in that you have this really rich finance depth of experience. So, I just need to know, how did you grow up in finance? Or how did you knew that you were going to be in finance? I think back when I was in grade school, you know, I wanted to be an astronaut. Did you hold up that sign and say, I want to be in finance?

2:07 – Jennifer Liu

That’s a great question. And actually, I studied engineering in college and I somehow found my way into Wall Street. So, I started off my career with an engineering background on Wall Street in the mid-2000s, and I actually experienced firsthand the downward spiral from the financial crisis.

2:29 – Jennifer Liu

It was a really difficult start to anyone’s career, but I think it taught me a lot of lessons about how every counterparty was interconnected, and there was so much contagion among the desks. And so, it was a really difficult start, but on the other hand, I was also able to be there when the banks were being rebuilt. And I got to see how every bank kind of repositioned their growth strategy and changed how they were thinking about things before, because there were new risks that they never thought about in the past.

3:02 – Jennifer Liu

And after a decade of on the investment management track on Wall Street, I joined Alibaba around the time of their IPO. And it was incredible to be part of this global fintech e-commerce platform serving one billion users. And my experience there, one of the most important lessons I learned that I still use today, is that it’s possible to move fast and pivot while operating at scale. And that’s one of the things that I take away when I’m leading the lending group at Anchorage today.

3:37 – Jennifer Liu

So, after 15 years of working at large-scale global companies, I wanted to be part of something where I could help build and bring something new to the community. And cryptocurrency was the best place to do that. I’m in Puerto Rico now, where cryptocurrency is like a thriving industry down here. And I’m really enjoy and in awe of the new innovations that come out like almost daily.

4:07 – Jennifer Liu

And the reason why I enjoy being in crypto, is that I feel like it’s a place where I can draw on my past experience in the financial services and in the tech industries to really influence the future and to help the community grow.

4:22 – Bryan Toft

That’s really fascinating. And to hear about your career journey, especially, I mean, through going, working on Wall Street during the financial crisis must have been a very formative experience. And now moving into crypto, which has its own ups and downs here, particularly recently, probably seeing some same threads in that.

4:43 – Bryan Toft

Hearing about the career journey, I want to also hear about the personal journey. So, going from Manhattan and then the pandemic hits and you move to New Jersey it sounds like, and now in Puerto Rico, I would love to hear more about that and how you made those decisions. So, if you’re living in Manhattan and you decide, OK, we got to go to New Jersey, and then you’re like, now we really got to go somewhere else, and now we’re going to Puerto Rico. Tell us about your thought process there and why you decided to do that.

5:09 – Jennifer Liu

Yeah, I think it’s also really reflective of what you’ve seen in my career as well. So, when you’re working in Manhattan, everything’s very regimented. You’re going on the PATH trains, there’s like a set time that you get into the office. It’s a very regulated routine. You see the same folks. And so, it kind of molds to also what people think about when they think about a Wall Street career. It’s your club. It’s in and out, it’s your same kind of mold.

5:42 – Jennifer Liu

I was really looking for something different. And you could see that with the move to Puerto Rico, trying to experience like what is beach life like. I’ve never really been a beach person. And so, I tried it out. And there’s a lot of white space in Puerto Rico. There’s a lot of freedom. And a lot of, you’ll find actually a lot of business owners in Puerto Rico, because I think there’s this creativity in this space to do what you feel you are passionate about.

6:12 – Jennifer Liu

And that’s why I also enjoy being part of the crypto ecosystem, because you’re really, it’s the grass is green. You can do whatever you’re interested in. And as long as you’re driving towards something, you’re passionate about, you can really make an impact.

6:31 – Becca Hoeft

That’s great, Jennifer. I question, when I think about, because I was starting to do some research on Anchorage Digital and understanding what they were, and for example, I bought my first Ethereum through Coinbase. And I understand Anchorage is not like Coinbase at all. But because most of our listeners work in the banking and fintech space, how would a bank or a fintech partner or work with Anchorage?

7:04 – Jennifer Liu

Yeah, so Anchorage launched in 2017 with custody because that was our most pressing need in the early days of the industry. You need a secure place that you can trust to hold your assets. From there, we launched into other services as the market matured. Trading, lending, staking, and governance. You can all do that within the security of the Anchorage platform.

7:33 – Jennifer Liu

So also, since then, as the crypto industry has matured, we’ve also begun partnering with a lot of banks, fintechs, and financial institutions, so that we can enable them to bring crypto services to their end customers. And the reason why they want to partner with us is for our compliance, our regulatory status as an OCC chartered bank and our technical security.

8:01 – Jennifer Liu

So just to give you some examples of how we’ve partnered with traditional banks, so we partnered with BankProv and Neuberger Berman with crypto backed US dollar loans. So, we help them manage collateral that’s crypto, because that is our expertise. Second, we recently announced a custody exchange network. So, we would like to see the future of crypto more in a similar kind of footing as TradFi and that exchanges will need to segregate client funds, while still providing direct access to trade. That is very important in our view to safeguarding client assets.

8:44 – Jennifer Liu

And then the third thing that we’ve done recently, is that we joined the American Bankers Association. And the reason why that we joined that, is because we want to learn from traditional bank members, like what are their needs. And at the same time, you want to share with them what we’re seeing in the digital asset market, how can we help you. We want to bring crypto to more people, and for us, because we are institutional, we want to enable other institutions to bring it to their customers.

9:14 – Bryan Toft

You mentioned kind of having a bank, OCC bank. Regulations are still forming with crypto, and you’re hearing a lot about that in Congress even. How are you dealing with that? I’m just curious, what’s your take on how regulations are forming as cryptocurrency comes into the mainstream?

9:35 – Jennifer Liu

Yeah, so we believe in working with the regulators, because to enable more institutional adoption in the space, you need a very sound regulated footing. Like, institutions have to understand that what they’re doing is in line with what the policymakers are thinking. And so that’s why we felt it was very important to get an OCC charter bank. Because we are now on the same regulatory footing as other national banks. And so, they are comfortable working with us, because they know who our regulator is.

10:10 – Jennifer Liu

And I mean, the only difference between what we do and what a traditional bank does, is that we hold crypto assets. So, like traditional banks, you hold gold, stock certificates. We just hold crypto. And we have the knowledge of how to do that securely. And so, we want to be able to allow other institutions to offer a crypto kind of offering to their end customers, and they need to feel safe and secure doing that. And that’s why they partner with Anchorage.

10:42 – Becca Hoeft

So, as the first federally chartered OCC bank in the country, I just have to ask, how hard was that?

10:53 – Jennifer Liu

Yeah, we always believe in a proactive approach with regulators and lawmakers, because that’s what’s going to enable a more accessible financial system for everyone. And it’s never easy to be the first, but we were initially a South Dakota charter bank. And we converted that into a federally regulated OCC bank.

11:23 – Bryan Toft

So, as Head of Lending at Anchorage Digital, I know that’s a business line for you, tell us about what type of lending you do.

11:31 – Jennifer Liu

So, Anchorage launched initially with custody. And one of the needs that we found from customers as the market matured, was how do we generate yield from our assets. And so that was really the genesis of the lending business. And when we initially started with this business line in 2018, it was really in product discovery mode and how can we create a product that solves the customer needs, which is what they’re really looking for is balance sheet productivity.

12:05 – Jennifer Liu

And so, from there, it was a genesis of our approach to the lending business, which is threefold. One, capital preservation is more important than high yields. We originate loans to only the most creditworthy borrowers and we review all eligible collateral. We safeguard this loan collateral within the Anchorage Digital bank, which is the federally OCC charter bank.

12:36 – Jennifer Liu

Second, we want the product to be easy to use, convenient, with a high quality of service to every client. And then third, we use a technology-driven approach to our risk management and the entire lending platform. So, Anchorage is a engineering first company. And that philosophy has flowed through on our lending business. So, if you fast forward to today, we are now one of the leaders in the crypto lending space and we’ve originated over $3 billion in loans.

13:14 – Bryan Toft

And that is significant volume, given how new crypto is to the financial sector. And I’m curious, what do you think the future is of cryptocurrency, especially as it relates to banking?

13:28 – Jennifer Liu

Well, I think one of the things that we are doing is, we want to make all our services API-driven. And so, I believe in the future that there won’t be a distinction between traditional banks and like crypto native banks like us,–

13:50 – Jennifer Liu

–Because traditional banks, they are going to want to plug into services like us so that if you are a customer, you can choose to buy fiat, you can choose to buy commodities, you can choose to buy Bitcoin, and it’s all within the safe safekeeping of your bank, which is, some is held in their own custody, and then for digital assets is held within someone like Anchorage.

14:15 – Becca Hoeft

Well, Jennifer, this has been super interesting, and I have one more question for you. And we ask this of every guest. What do you think the NextGen Banker looks like?

14:28 – Jennifer Liu

If you look at the infrastructure providers in the cryptocurrency space, I’ve worked at two so far, and every mission of these firms is that you’re trying to make financial services accessible to everyone. And so that basically it’s so that every person can be their own banker. And you have the choice to hold, lend, trade your assets within centralized platforms.

14:54 – Jennifer Liu

If you are looking for security, you want a regulated framework, and you’re looking for convenience. But on the other hand, in crypto, you can act solely at your own discretion through decentralized protocols or self-custody wallets. And so, I believe that it’s this ability to choose that cryptocurrencies bring in which is very, very unique. And I love it that every person can be their own banker in the future.

15:20 – Becca Hoeft

Jennifer, I love hearing your passion. Thank you so much for your time on NextGen Banker podcast. We appreciate your insights into banking and into crypto and the future of all of this together. Thanks for listening to the NextGen Banker podcast. We’ll see you soon.

15:39 – Becca Hoeft

For this episode’s musical feature, we’re showcasing Ramona Woolf. Ramona Woolf is the cool older sister of Aaron Sprinkle and Jessie Villa’s project, Luna Wave. She is nostalgic, fresh, a bit moody, and pretty sentimental. Ramona Woolf channels the obsession with ’90s and early 2000s into any music that has shaped the worlds Aaron and Jessie live in. Here is Sinking by Ramona Woolf.


17:03 – Becca Hoeft

That was sinking by Ramona Woolf. You can find more of Ramona Woolf’s music on Spotify. If you would like your music featured on the NextGen Banker podcast, email David at nextgen-banker.com with a link to your music and website. Thanks for listening to the NextGen Banker podcast. We’ll see you next time.