Deribit Crypto Exchange Rolls Out Block Trading for Derivatives




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Deribit launches block trading for derivatives

Deribit, a crypto exchange for futures and options on BTC and ETH plans to introduce block trading in crypto and derivatives. The firm unveiled this new on August 22 through a blog post noting that it had joined hands with Paradigm in this venture. Per the partners, this project aims to drive for the mass adoption of the crypto space.

According to the blog post, Deribit has set aside a maximum of 40 BTC and 800 ETH for this project. At the time of writing these coins are worth approximately $550,000. These coins would run options contracts pegged to BTC and ETH. Per John Jansen, the CEO of Deribit, ten major crypto trading firms have already signed up for this service. However, the founder of Paradigm, Anand Gomes only named QCP Capital.

First of Its Kind

Per the blog post, this project will be the world’s first-ever multi-instrument block trading solution. Before this launch, traders exchanged terms of trade via Telegram or Skype. They would then organize execution manually on Deribit’s order book. While this method worked, it exposed them to execution-related market risks.

Paradigm’s messaging service would allow investors to negotiate crypto-derivative trades amongst themselves quickly. Once the institutional investors reach an agreement, the chat platform would automatically submit their trade information to Deribit. After this, the crypto exchange would execute and clear their orders.

Commenting on this launch Philippe Bekhazi, the CEO of XBTO Group noted,

For the first time, institutions that trade crypto derivatives in large volumes can negotiate privately on the Paradigm platform, after which the trade will be automatically executed, margined and cleared at Deribit and displayed on the public tape as a block trade, eliminating any execution risk associated with the order book.

How to Institutional Traders will Access this Service

Traders can access crypto-derivative block trading through the Paradigm system. Apart from this, they can access this service via Deribit’s API. They will have access to block trades in BTC and ETH-backed futures and options. This includes access to spreads and combinations of both coins.

This service is meant for professional traders only. To access it, Paradigm must invite you. At the moment, Paradigm is accepting requests from interested individuals through its site. However, only individuals that Paradigm approves will be able to access this service.

This news comes after Caspian a Galaxy Capital-backed firm launched trading in crypto derivatives through Deribit.

Explaining why Caspian had made this move, Robert Dykes, the firm’s CEO said,

Our goal at Caspian is to provide crypto traders and investors the same standard of tools and service that exist in the traditional markets.

Do you think Deribit’s block trading service in crypto and derivatives will see mainstream firms adopt crypto? Let us know in the comments below.