BitGo and Copper Revolutionize Trading with Off-Exchange Settlement on Deribit

In a significant advancement for cryptocurrency trading, BitGo and Copper have launched a pioneering off-exchange settlement trading solution on the Deribit platform. This innovative model allows traders to engage in spot and derivatives trading while keeping their assets securely held in qualified custody, enhancing security and operational efficiency in the post-FTX trading landscape.

Key Takeaways

• Partnership: BitGo and Copper collaborate to provide a secure trading model on Deribit.

• Off-Exchange Custody: Assets are held in qualified custody with BitGo Trust, minimizing risks associated with exchange storage.

• Automated Settlement: Trades are automatically settled using Copper’s ClearLoop and BitGo’s Go Network.

• Increased Capital Efficiency: Traders can access Deribit’s features without needing to pre-fund their strategies.
  
  

The Need for Enhanced Security

The cryptocurrency market has faced significant challenges, particularly following the collapse of major exchanges like FTX. Traders are increasingly seeking ways to mitigate risks associated with holding assets on exchanges. The partnership between BitGo and Copper addresses these concerns by providing a secure environment for trading.

How It Works

1. Qualified Custody: Assets are secured off-exchange in qualified custody with BitGo Trust.

2. Trading on Deribit: Clients can trade spot and derivatives on Deribit without moving their assets on-chain.

3. Automated Settlement: Trades are settled automatically through Copper’s ClearLoop, ensuring a seamless trading experience.

4. Delivery Versus Payment (DvP): This feature allows for instantaneous settlement between BitGo clients, reducing settlement risk.
   
   

Benefits of the New Model

• Security: By keeping assets in qualified custody, the risk of loss due to exchange failures is significantly reduced.

• Operational Agility: The automated settlement process streamlines trading operations, allowing for quicker execution of trades.

• Market Accessibility: This model opens up new opportunities for institutional investors, enhancing liquidity and capital efficiency.
  
  

Industry Impact

The introduction of this off-exchange settlement model is expected to reshape the trading landscape. As Luuk Strijers, CEO of Deribit, stated, the collaboration between BitGo and Copper will unlock new opportunities for investors and change how trading is conducted in the cryptocurrency space.

Conclusion

The launch of the off-exchange settlement trading solution by BitGo and Copper marks a pivotal moment in the evolution of cryptocurrency trading. By prioritizing security and efficiency, this partnership sets a new standard for how traders can engage with digital assets, fostering greater institutional adoption and confidence in the market.

Sources

• Crypto Custody Firms BitGo and Copper Deliver Off-Exchange Settlement for Deribit — TradingView News, TradingView.

• BitGo, Copper launch trading solution with off-exchange settlement on Deribit, Crypto News.

• BitGo and Copper Launch First Trading Model with Off-Exchange Settlement from Qualified Custody, Featuring Deribit | Business | hastingstribune.com, Hastings Tribune.

• BitGo and Copper enable clients to trade on Deribit with off-exchange custody and settlement | The Block, The Block.

• BitGo and Copper Launch First Trading Model with Off-Exchange Settlement from Qualified Custody, Featuring Deribit | Business Wire, Business Wire.

This article was written with the assistance of AI to gather information from multiple reputable sources. The content has been reviewed and edited by our editorial team to ensure accuracy and coherence. The views expressed are those of the author and do not necessarily reflect the views of EOS Support. Original reporting sources are credited whenever appropriate and as required. This article is for informational purposes only and does not constitute financial advice.