Several traditional banks have been embracing the digital wave by testing cryptocurrency water. Singapore’s largest bank, DBS, has joined the ranks of its counterparts as it announced the launch of over-the-counter (OTC) Bitcoin (BTC) and Ethereum (ETH) options trading as well as structured notes.
The bank’s institutional clients will be able to employ this service in the fourth quarter of 2024.
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DBS Bank’s New Crypto Offerings
In a recent press release, the bank revealed that its institutional investors will be receiving an upgrade through this upcoming service. Through the use of different options structures, clients of DBS Bank will be able to hedge their positions in Bitcoin and Ether. The release further read,
“It is the first Asian-headquartered bank to offer financial products whose value is linked to the price of Bitcoin and Ethereum.”
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Here’s Why DBS Is Doubling Down On Crypto
It should be noted that Singapore’s DBS bank isn’t new to the cryptocurrency industry. At present, the firm’s clients can trade spot crypto employing the bank’s native exchange, DBS Digital Exchange (DDEx). This was launched back in 2020. Jacky Tai, Group Head of Trading and Structuring, Global Financial Markets, DBS, elaborated on the firm’s latest venture and said,
“Professional investors are increasingly allocating to digital assets in their portfolios. Now, our clients have an alternative channel to build exposure to the asset class and incorporate advanced investment strategies to better manage their digital asset portfolios.”
Benefits Of Options Trading
Additionally, with the latest inclusion, DBS bank’s clients will be able to carry out options trading. Through this, investors will be able to protect themselves against the volatility of cryptocurrencies by entering into contracts. The value of these contracts is derived from the price of cryptocurrencies. This further allows traders to commit to the purchase or sale of the assets at a fixed price.
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Structured notes, on the other hand, are debt securities. Financial institutions issue these.