Singapore’s DBS to launch OTC crypto options for institutional investors

Banking giant DBS is set to launch crypto options and structured notes for corporate and accredited clients, becoming the first Asian bank to offer such products.

Singapore-based DBS Bank announced plans to launch over-the-counter cryptocurrency options trading and structured notes for eligible institutional investors and accredited asset clients from the fourth quarter of 2024.

The move makes it the first financial lender in Asia to offer financial products tied to the value of Bitcoin (BTC) and Ethereum (ETH), the bank said in a press release dated September 17. The move comes as professional investors are “increasingly allocating digital assets in their portfolios,” said Jacky Tai, head of trading and structuring at DBS Group.

“Our clients now have an alternative channel to gain exposure to the asset class and incorporate advanced investment strategies to better manage their digital asset portfolios.”

Jacky Tay

The bank has previously allowed clients to trade crypto and security tokens through its own crypto arm, DBS Digital Exchange. With the new initiative, clients can gain exposure to crypto through options trading and structured notes, and potentially “take delivery of fiat or the underlying crypto,” the press release said.

“For example, a client looking to manage Bitcoin’s inherent volatility could purchase a put option that gives them the right to sell Bitcoin at a fixed price on a future date, even if Bitcoin prices fall below the fixed price on that future date.”

DBS

According to the press release, while the bank is deepening its web3 roots, crypto options and structured notes will only be offered to eligible institutional investors and accredited clients of DBS Private Bank and DBS Treasures Private Client.

In late August, DBS launched a blockchain-based solution that uses smart contracts to streamline government grant distributions. The pilot aims to demonstrate how these programmable grants can increase transparency and efficiency in the grant distribution process, the bank said.