Derivatives

Amongst the world’s premier market makers in non linear crypto currency derivatives.

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Genesis trading derivatives

Industry-leading pricing and liquidity; a premier institutional counterparty for the sector’s top tier options transactions.

Treasury allocations

Bespoke derivatives solutions to manage or express views on volatility, hedge directional risk, harvest incremental return, or generate complex payoff profiles.

Trade options

Price and trade vanilla options and forwards across a widening range of underlying assets, in both cash settled and physically settled format.

Complex spreads

Implement more complex spreads and structures, including straddles, strangles, collars and calendar spreads.

Structured products

Price and risk-manage a select set of exotic options and structured products often tailored to meet specific needs.

2021 Market Activity

$53.8B

Derivatives Notional Value Traded

$116.5B

Spot Volume Traded

$130.6B

Loan Originations

Derivatives Overview

Genesis supports a diverse product set including bilateral OTC options and forwards, exchange-traded derivatives, negotiated block trades and certain on-chain derivatives. We can:

  • Engage in both programmatic and discretionary volatility management strategies and enter into customized bilateral derivatives instruments to exploit related opportunities in mining, staking, and borrow/lend.

  • Make markets on both linear and non linear derivatives of most major crypto assets.

  • Make similar markets on small- and mid-cap assets on a case-by-case basis, subject to market conditions and liquidity.

  • Offer European- or American-style exercise, and cash- or physical- settlement in OTC format with benchmark or bespoke expiry dates and times.

  • Construct multileg combos and spreads in institutional size at some of the industry’s tightest spreads  to form more complex strategies with attractive payouts suited to individual requirements.

  • Manage the entire trade lifecycle including trade reporting, upfront and maturity settlements, and collateral management.

  • Access all major global venues for hedging linear and non-linear risk.

  • Accept a broad range of assets as collateral (some trade formats may require USD collateral).

  • Provide 24/7, up-to-the-second coverage and quotations to support event-driven theses and to assist in managing catalyst-specific risks.

  • Engage in basis trades (spot vs forwards), lending/repo transactions, call overwrite, and short-volatility structures to generate incremental return.

  • Support staking and other onchain forms of cryptographic commitments embedded into a derivative or in collateral posted.

  • Hedge market risk in staked assets and provide market-neutral cash-flow generative structures.

  • Hedge corporate balance sheet exposure and/or cash flows deriving from  crypto assets, income streams, and NFTs.

  • Architect and execute comprehensive solutions for both institutional digital asset investment programs and programmatic liquidation/monetization of crypto cash flows.

  • Design, deliver and support distributed investment and hedging products utilizing our proprietary, world class risk management and pricing tools.

Regulatory Notes

  • GGC International Limited (“GGCI”): GGCI is a British Virgin Islands company wholly owned by GGC which carries out spot trading activity and hedges the exposure of GGC by entering into derivatives on digital assets as a principal and on exchanges.

Regulatory compliance brand illustration

The Genesis derivatives desk is currently the #1 global crypto derivatives desk by volume ... growing more than 9x YoY in 2021.”

— Global Blockchain Business Council, 2021 Annual Report

Genesis’ derivatives arm is highly successful, and still growing - in Q4 ’21 the platform saw over $12.7 billion in activity.”

— Bitcoin Association, February 2022

Derivatives FAQ

What underlying assets does Genesis trade?

We make markets in most major crypto assets and smaller-cap assets on a case-by-case basis subject to market conditions and liquidity. To date, we have traded derivatives on over 50 assets from ADA to ZEN.

What are examples of implementable strategies?

Genesis can trade vanilla options and forwards in bilateral OTC or on-exchange listed format, on a broad range of underlying crypto assets. This includes BTC and ETH and a dynamic repertoire of top-liquidity altcoins (ADA, AVAX, BNB, MATIC, SOL et al). Our counterparties utilize both linear and non linear derivatives to hedge risk around protocol specific events (hacks or regulatory outcomes), generate additional static returns on their crypto holdings (often selling calls against cryptocurrencies they own) and express views on idiosyncratic market prices, such as the level of bitcoin implied volatility or ether put skew.

How does Genesis hedge and manage risk?

Our derivatives business acts as a principal, committing its own capital to support client trades and dynamically hedging the risks of those trades on an assortment of venues. Our trading teams consist of crypto-fluent veterans from both the buy-side and sell-side with decades of experience managing multi-billion dollar portfolios, proprietary trading units, and flow books. We manage the comprehensive risks of our business according to the most rigorous quantitative standards of exacting conduct with cutting-edge tools and first-class data.

Counterparties are thoroughly vetted during the initial onboarding process, and both their credit profile as well as the exposure of their trades are dynamically overseen with low latency programmatic and discretionary functions. Genesis derivatives transactions adhere to all regulatory requirements for collateralization and reporting, under the framework of industry-standard documentation. This may include entering into an ISDA/CSA relationship with the counterparty.

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Our team is ready to help you every step of the way, with a commitment to sophisticated execution and best-in-class professional support.

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