BitGo Taps Copper to Deliver Off-Exchange Settlement for Deribit

Blockchain company BitGo has teamed up with Copper, a collateral management firm, to bring a new service to its clients. They have allowed clients to trade on Deribit while retaining off-exchange custody and settlement. This is the first-of-its-kind of such a solution.

Deribit’s Integration With Go Network 

In perspective, users can transact on the crypto derivatives exchange while securing their assets off-exchange. The initiative will leverage BitGo Trust’s qualified custody service, while the settlement of the trades is automatically achieved through Copper’s ClearLoop and BitGo’s Go Network infrastructure.

By integrating Deribit into the Go Network through ClearLoop, these entities have allowed investors to benefit from increased capital efficiency. Users can hold their assets with BitGo Trust and utilize Deribit’s options and futures trading features. More importantly, they do not need to pre-fund their strategies. 

This strategic partnership between BitGo and Copper has been brewing for some time. In November 2023, both entities revealed their off-exchange custody and settlement plans. This was just around when investors sought less risky investment options post-FTX implosion. 

Deribit And BitGo Aligns to Provide Deep Liquidity 

According to a statement released by the companies on Thursday, the launch’s ultimate goal is to address the need for deep liquidity while upholding security and operational agility. Deribit CEO Luuk Strijers acknowledged that the collaboration is a significant milestone. He says the alliance will birth new opportunities and alter the market’s trading trajectory. 

“Clients of BitGo’s Go Network and Copper’s ClearLoop can now trade spot and derivatives on Deribit while keeping assets securely off-exchange in qualified custody, ensuring seamless and automatic settlement,” Deribit posted on X.

From Self-custody to Bitcoin ETFs

In other related custody news, renowned crypto analyst Plan B recently revealed that he had transferred his entire Bitcoin (BTC) holdings from self-custody to spot Bitcoin Exchange-traded Funds (ETFs). This is a notable pivot from the belief that Bitcoin should be held in self-custody. With this new development, he now manages the holdings like stocks and bonds for convenience.

This also reflects that crypto ETFs are becoming more appealing to investors. The reason for this is not far-fetched, especially because ETFs offer a structured and regulated strategy for holding Bitcoin while remaining shielded from the risk of theft or mismanagement.