What You Need to Know
- The Deribit Block Request-for-Quote (RFQ) interface has successfully facilitated over $23 billion in trades since its launch in March.
- This system enables large transactions to occur outside of public order books, minimizing market impact.
- The usage of block trades via Deribit’s RFQ system rose to 27.5% this month, indicating a significant increase in institutional interest.
Rapid Growth in Institutional Trading
The trend of institutional investment in cryptocurrencies is intensifying. Deribit’s on-demand liquidity tool has shown exceptional growth, registering a cumulative trading volume exceeding $23 billion within four months of its launch in March.
This prominent derivatives exchange specializes in providing the largest options market for major cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), Solana (SOL), and XRP. It also offers futures and spot trading options.
Introduced in March, the block RFQ allows institutional traders to make pricing requests for larger-scale trades, which can include single or multi-legged strategies. This innovative system displays the best buy and sell quotes to facilitate optimized trading.
Market makers contribute liquidity by providing competitive quotes, thus allowing large dealers to execute trades without notably impacting market prices.
Luuk Strijers, CEO of Deribit, remarked, “The RFQ system allows for multi-leg trades and various pricing options, enhancing execution efficiency for large trades while reducing adverse selection.”
In March, the RFQ system managed $883 million in trades, which escalated to $6.3 billion in April, further climbing to $9.8 billion by May. By mid-June, the block trades ratio has climbed significantly, underlining the persistent demand from institutions.
