Deribit, one of the world’s leading cryptocurrency options and futures exchanges, has partnered with Sygnum Bank, a regulated digital asset financial institution, to bolster security for institutional crypto trading.
As part of the partnership, Deribit has now integrated Sygnum Protect, Sygnum Bank’s off-exchange custody platform, supported by Fireblocks’ Off-Exchange solution. This will allow investors to hold assets securely in a regulated bank trade without pre-funding. It is also set to reduce counterparty risks by providing automated settlement & collateral management.
Announced today, the collaboration aims to provide institutional investors with a secure, efficient, and capital-optimized trading experience by leveraging bank-grade custody and settlement solutions.
Strengthening Security in Institutional Crypto Trading
Institutional investors have long faced challenges in crypto trading, particularly concerning fund security and counterparty risk.
By partnering with Sygnum Bank, Deribit is aiming to enhance the safety and trustworthiness of its platform, enabling institutional traders to engage in derivatives trading with reduced risk exposure.
A key component of this partnership is the integration of Fireblocks’ “Off Exchange” service, which allows investors to trade on Deribit while keeping their assets securely custodied with Sygnum. This eliminates the need to pre-deposit funds on the exchange, significantly reducing exposure to exchange-related risks such as insolvency or security breaches.
Boost for Institutional Crypto Adoption?
One of the primary barriers to institutional crypto adoption has been the requirement to transfer funds to exchanges before trading. This exposes investors to counterparty risk and potential loss in case of exchange failures. By leveraging Sygnum’s regulated custody services, institutional clients can now trade with confidence, knowing their funds remain within a bank-grade security framework.
Fireblocks’ secure Multi-Party Computation (MPC) technology plays a crucial role in facilitating this solution. It enables non-custodial settlement, ensuring that funds are only transferred when trades are executed, thereby improving capital efficiency and security for institutional market participants.
Strategic Growth for Deribit, Sygnum, and Fireblocks
This partnership is a significant milestone for Deribit as it seeks to expand its institutional client base. By offering a more secure trading environment, the exchange is positioning itself as a preferred choice for hedge funds, family offices, and other institutional investors looking to trade crypto derivatives.
For Sygnum, this collaboration reinforces its role as a trusted banking partner in the digital asset industry. The Swiss-regulated crypto bank continues to expand its range of institutional services, bridging the gap between traditional finance and the digital asset economy.
Fireblocks, a leading provider of digital asset security solutions, benefits from further adoption of its “Off Exchange” service. As more institutions prioritize security in crypto trading, Fireblocks’ infrastructure is becoming an industry standard for safe and efficient asset transfers.
Thus, as institutional interest in digital assets grows, ensuring secure and efficient trading solutions remains a top priority. The partnership between Deribit and Sygnum Bank, facilitated by Fireblocks’ technology, marks a significant advancement in institutional crypto trading security. By offering a regulated, bank-grade custody and settlement solution, this initiative paves the way for greater institutional participation in the crypto derivatives market while setting new security standards for the industry.
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Hold assets securely in a regulated bank