$105.74 Billion Market Cap DBS Set to Introduce Crypto Options and Structured Notes for Institutions

• Singapore’s largest bank, DBS, has announced the upcoming launch of over-the-counter options trading for Bitcoin and Ethereum tokens.
• These options will launch in the fourth quarter of this year, with the bank saying that its expanding crypto products are due to a rise in demand from institutional clients.

DBS Bank, the largest bank in Singapore with a $105 billion market cap, will expand its crypto offerings in the fourth quarter of the year as demand from its high-net-worth clients increases.

The lender revealed today that it intends to launch over-the-counter crypto options trading and structured notes for its Bitcoin and Ethereum-holding accredited wealth clients.

BREAKING!
Singapore's largest bank @dbsbank has launched over-the-counter cryptocurrency options trading and structured notes.Starting Q4 2024, qualifying institutional investors and accredited wealth clients will have access to the new product.https://t.co/WbzqpbBqrz

— PandaRippleXRP (@RipplePandaXRP) September 17, 2024

In its announcement, the bank claimed it would be the first “Asian-headquartered bank to offer financial products whose value is linked to the price of Bitcoin and Ethereum.”

DBS is no stranger to crypto. The bank already operates the DBS Digital Exchange (DDEx), where clients can trade crypto and security tokens. In the fourth quarter, it will build on this foundation to offer options trading and structured notes, allowing users to take their yield in fiat or take delivery of the underlying currency.

Options trading is the buying and selling of options, which are contracts that give the client the right (but not the obligation) to buy or sell the underlying assets, in this case, BTC and ETH. Call options give the client the right to buy the asset, while put options relate to selling the asset.

Unstructured notes, on the other hand, are more complex as they don’t follow any set format, making them flexible. Usually, banks use them to issue debt securities, with the returns linked to the performance of the underlying assets, in this case, ETH and BTC.

DBS Bank Goes All-in on Crypto

DBS Bank‘s expansion of crypto products reflects a rise in demand for more sophisticated crypto products from its clients, says the bank’s Group Head of Trading and Structuring, Jacky Tai. She noted that its clients have been increasingly allocating parts of their portfolios to crypto, adding:

Underpinned by DBS’ strong credit ratings and longstanding expertise in structuring solutions, these financial products are an expansion of the bank’s value proposition to provide clients trusted institutional-grade access to the digital asset ecosystem. 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.

For DBS, the decision to expand its crypto offerings was an easy one. In the first eight months of the year, its crypto exchange DDEx has tripled its traded volume compared to last year, the bank revealed. The number of clients also shot up 36%, with the custodied digital assets surging 80%.