Singapore’s Biggest Bank Introduces Bitcoin and Ethereum Options Trading and Structured Notes
DBS Bank, Singapore’s largest bank, is making significant moves in the crypto space by unveiling plans to introduce structured notes and over-the-counter (OTC) crypto options trading for institutional clients. The initiative, set to kick off in the fourth quarter of 2024, will enable DBS Bank’s institutional clients to engage with financial products linked to the prices of the two leading cryptocurrencies, Bitcoin (BTC), and Ethereum (ETH).
In a recent press release, DBS Bank announced that institutional clients looking to gain exposure to Bitcoin and Ethereum can do so through the bank’s structured notes and options trading services. As per a report by GlobalBank, DBS Bank holds the top position in Singapore in terms of asset size, boasting a value of $509.1 billion.
Crypto options contracts, a key component of the upcoming offering, serve as a safeguard for investors against the volatility risks associated with the underlying assets. These contracts derive their values from the prices of specific assets, such as Bitcoin and Ethereum, allowing investors the flexibility to determine when to buy or sell assets at pre-set prices. Additionally, structured notes, which are debt securities issued by banks to clients, deliver returns based on the performance of underlying assets.
DBS Bank’s announcement highlighted the availability of various options structures that clients can leverage to mitigate market volatility affecting these assets. For example, the “put option” allows DBS customers to sell BTC at a predetermined price and date, regardless of the asset’s performance on the specified date.
Jacky Tai, DBS Bank’s Head of Trading and Structuring, emphasized the significance of the forthcoming solution, stating that as professional investors increase their digital asset holdings, the new offerings in crypto options trading and structured notes provide them with advanced portfolio management strategies. Tai also pointed out that the upcoming services will broaden customers’ exposure to the crypto ecosystem.
It is essential to note that DBS Bank has been actively involved in the crypto space, having previously integrated spot crypto trading into its banking app, DBS Digibank, in 2022. This feature allows accredited wealth investors to trade four cryptocurrencies directly from the bank’s native exchange, DBS Digital Exchange (DDEX). Furthermore, in a recent partnership with digital payment provider Ant International, DBS Bank introduced DBS Treasury Tokens on its EVM-compatible blockchain.
In conclusion, DBS Bank’s latest move to introduce structured notes and OTC crypto options trading for institutional clients marks a significant step in expanding its presence in the crypto market and providing advanced financial products to cater to the evolving needs of investors.
