- Sygnum expands custody to Deribit, enabling secure trading and asset protection.
- Counterparty risks are reduced as assets remain off-exchange with Sygnum Protect.
- Fireblocks’ Off-Exchange solution enhances institutional adoption with seamless integration.
Swiss Sygnum Bank has expanded its off-exchange custody service, Sygnum Protect, to Deribit, the world’s leading crypto derivatives exchange. This allows institutional traders to access Deribit’s deep liquidity while keeping their assets securely held in Sygnum’s regulated custody solution. The integration helps minimize counterparty risks and keeps funds out of exchanges, shielded from cyber threats. The company’s Off-Exchange solution allows for the automation of settlements and collateral.
Benefits of Sygnum Protect
Trading through exchanges exposes institutional traders to risks such as hacks, insolvencies, and operational failures. These risks have led to significant losses in the past, making secure custody solutions essential. Sygnum Protect minimizes these risks by offering secure custody within a regulated Swiss banking system, ensuring institutional-grade security while maintaining access to liquidity.
Many cyber attacks encountered in the market have considerably heightened counterparty risks. This has created a trend of assets being withheld from exchanges. Dominic Lohberger, Sygnum’s Chief Product Officer, emphasized the importance of separating crypto custody from trading for security. He stated:
Counterparty risk awareness in crypto comes in cycles, and the recent major cyber-attack has triggered one of the largest waves of exchange derisking since FTX.
Deribit supports this integration as it enhances security and transparency for institutional clients. Luuk Strijers, the CEO of Deribit, pointed out that the shift would be beneficial for the company and institutional clients. He stated:
We are very pleased to offer additional security and transparency capabilities to our institutional clients looking to trade crypto derivatives through Sygnum Protect.
Fireblocks CEO Michael Shaulov highlighted that the Off-Exchange solution enhances institutional adoption by facilitating seamless integration between exchanges and custodians, improving security. This development also boosts confidence in regulated custody services.
Related: Trump’s Crypto Reserve Sparks Bitcoin vs. Altcoin Debate
The crypto market is gradually moving towards defending the right to trade safely. Businesses need robust solutions to safeguard digital assets from exchange-related risks. This change is well illustrated by Sygnum, which has expanded its service offering with Sygnum Protect. The platform also enables institutions to trade with low exposure to exchange-related risks.
