BlockFills, an institution-focused digital asset technology and trading firm, has announced a partnership with CoinDesk Indices to introduce options linked to the CoinDesk 20 Index (CD20). This collaboration aims to meet the growing demand from institutional investors for a broader range of tradable products in the digital asset space.
The CD20 Index, launched a year ago, tracks the performance of top digital assets beyond just bitcoin (BTC) and ether (ETH). By offering options tied to this index, traders can now speculate on volatility and time in addition to price movements, providing enhanced liquidity and trading opportunities for professional investors.
Options are derivative contracts that grant the holder the right to buy or sell the underlying asset at a predetermined price on or before a specific date. With the current surge in the cryptocurrency market, driven by institutional adoption of bitcoin, there has been a noticeable increase in interest for options linked to BTC and other crypto assets, including alternative investment products like spot ETFs.
Perry Parker, head of options trading at BlockFills, highlighted the importance of providing institutional investors with a reliable reference index for trading, investing, and benchmarking performance in the digital asset market. This move reflects the maturation of the crypto industry and the evolving needs of sophisticated market participants.
Institutions have already begun participating in BlockFills’s CD20 options, with prominent digital asset manager Hyperion Decimus executing the first transaction earlier this month. Chris Sullivan, Principal at Hyperion Decimus, expressed enthusiasm for the new market, emphasizing the strategic value of the BlockFills CoinDesk 20 index options for managing portfolios within the digital asset class.
Sullivan noted that Hyperion Decimus intends to leverage these derivatives for both hedging and directional trading strategies, showcasing the versatility and utility of options in the institutional investor toolkit. The collaboration between BlockFills and CoinDesk Indices is set to bring a new level of sophistication and flexibility to the digital asset market, catering to the evolving needs of institutional investors in this rapidly growing space.