Deribit And Paradigm Partner To Offer Block Trading For Derivatives Targeting Institutions

The increasing demand from institutional investors has made Deribit and Paradigm to team up to launch multi-instrument block trading solution for crypto derivatives.

The innovation will allow organizations to use the Paradigm chat for direct transactions with counterparties at their discretion. After agreeing on a transaction, trade data will be submitted for the Deribit execution and clearing automatiсly.

According to Bloomberg, the function is the first of its kind, since previously institutional traders had to agree on large trades through messengers, and then manually coordinate execution in the Deribit’s order book. The method was high-risk, especially if we take into account spreads and combined trades.

Talking about the new service, XBTO Group’s CEO Philippe Bekhazi said that 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. He said:

“When excellent companies operating in a similar space work together by leveraging relationships and sharing ideas, everyone wins – including, most importantly, the end-user.”

Deribit’s CEO, John Jansen, reportedly said the new service will offer block trades with a minimum of 40 Bitcoin and 800 Ether or approximately $400,000 and $150,000 for options contracts linked to those cryptocurrencies.

Ten top crypto trading firms have already signed up to use the service, with Paradigm founder Anand Gomes naming QCP Capital in the report.

As per its website, Paradigm offers tools allowing over-the-counter traders to automate price negotiation and settlement. Using Paradigm’s messaging service, parties can set up the options trades, which are then then settled and cleared at Deribit. Commonly, traders use Telegram to carry out such negotiations.

According to Bloomberg the Amsterdam-based Deribit is not regulated in the Netherlands, since local regulation defines derivatives as cash-settled contracts. However, the exchange has the safety net of an insurance fund, should traders default on payments due to issues like bankruptcy.

Back in March, Galaxy Capital-backed institutional trading firm Caspian launched trading in crypto derivatives through an integration with Deribit’s platform.

Get Free Email Updates!

*Action* Enter Best Email to Get Trending Crypto News & Bitcoin Market Updates

I will never give away, trade or sell your email address. You can unsubscribe at any time.

Joseph Kibe
Joseph Kibe
Joseph is a blockchain and cryptocurrency enthusiast, with a strong conviction that exposure of blockchain technology is for the good of the society. Fascinated by the massive potential of cryptocurrencies and the technology behind them – blockchain – Joseph spent lots of his time learning more about the industry, becoming a polished expert writer in the sector. He covers any cryptocurrency and blockchain related content.

[Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

[Disclosure] The published news and content on BitcoinExchangeGuide should never be used or taken as financial investment advice. Understand trading cryptocurrencies is a very high-risk activity which can result in significant losses. Editorial Policy \\ Investment Disclaimer

LEAVE A REPLY

Please enter your comment!
Please enter your name here

3,511FansLike
2,795FollowersFollow
4,272FollowersFollow

Live Bitcoin Price & Latest BTC Charts

Today's Latest Crypto News

BitcoinExchangeGuide is a hyper-active daily crypto news portal with care in cultivating the cryptocurrency culture with community contributors who help rewrite the bold future of blockchain finance. Subscribe on Google News, see the mission, authors, editorial links policy, investment disclaimer, privacy policy. Got News? Contact us, we are human too. Note: nothing here is financial advice, do your own research thoroughly.

Start Using Crypto Today