In this week’s roundup, we also look at new product developments from Jacobi AM and OKX, the launch of Nomura’s digital assets arm in Dubai, and updates on the Hong Kong digital asset regulatory scene.

MarketVector Indexes (MVI) has teamed up with financial data platform Token Terminal to provide access to products that track data in web3 and blockchains.

Under the collaboration agreement the two firms will co-create indexes using any data components extracted from open blockchains, targeting institutions, advisors and investors interested in digital assets exposure.

By integrating fundamental data into our index methodology, we can better reflect blockchain protocols' true economics and user traction - Martin Leinweber, MarketVector

The partnership responds to demand from institutional clients interested in an index product that ‘is easily understandable for investors from traditional finance,’ Martin Leinweber (pictured), digital asset product strategist at MarketVector.

‘By integrating fundamental data into our index methodology, we can better reflect blockchain protocols' true economics and user traction,’ Leinweber said. ‘We believe that the next cycle of crypto adoption will be driven more by fundamentals than the previous cycles.’

The Frankfurt-based index provider aims to incorporate Token Terminal’s perspective in data and analytics into its Digital Asset index to provide a ‘more comprehensive view of the crypto marketplace to its clients’.

On 27 July, MarketVector partnered with staking infrastructure provider Figment to introduce a range of staking rewards indexes, targeting institutions and investors in Ethereum.

Euronext lists first spot BTC tracker in Amsterdam

London-based Jacobi Asset Management has listed Europe’s first spot bitcoin exchange-traded fund (ETF) on Euronext Amsterdam today (15 August).

The Jacobi FT Wilshire Bitcoin ETF tracks the performance of the FT Wilshire Bitcoin Blended Price Index, which is provided by Wilshire Indexes with a built-in Renewable Energy Certificate (REC) solution created in collaboration with digital asset platform, Zumo.

The new ETF is regulated by the Guernsey Financial Services Commission and trades under the ticker BCOIN. Fidelity Digital Assets provides custody services with Flow Traders acting as market maker, and Jane Street and DRW as authorised participants.

‘It is exciting to see Europe moving ahead of the US in opening up bitcoin investing for institutional investors who want safe, secure access to the benefits of digital assets using familiar and regulated structures,’ said Martin Bednall (right), CEO of Jacobi Asset Management.

The ETF also represents the first digital asset fund compliant with Article 8 of the European Sustainable Finance Disclosure Regulation through its decarbonisation strategy. Jacobi stated it has implemented a verifiable built-in renewable energy certificate (REC) solution, allowing ‘institutional investors to access the benefits of bitcoin whilst also meeting ESG goals’.

The fund was first approved in October 2021 and was set to go live in July 2022. However, the firm postponed the launch as ‘the time wasn’t right’ following the collapse of the Terra ecosystem and the bankruptcy of the FTX cryptocurrency exchange last year.

OKX adds to Shark Fin structure

Cryptocurrency exchange OKX has introduced an ‘auto renewal’ feature across its three-day and seven-day Shark Fin structured products.

OKX’s Shark Fin is a principal-protected structured product that allows users to earn stablecoin Tether (USDT) when the underlying asset expires within a pre-defined range.

The new feature will enable users to continuously earn from USDT ‘by automatically reinvesting their principal in the next seven-day Shark Fin round without needing to wait for their funds to be unlocked,’ stated the firm.

OKX recently forged into other structured product offerings, including dual investment products and a snowball structure.

Nomura’s digital asset arm gets green light in Dubai

Laser Digital Middle East FZE, the digital asset subsidiary of Japanese financial services giant Nomura, has received operating license approval from Dubai’s Virtual Asset Regulatory Authority (VARA), the final stage of the licensing process.

The licence approval now allows Laser Digital to provide virtual assets (VA) broker-dealer services and VA management and investment services from its Dubai entity.

Following the approval, Laser Digital will launch its trading and asset management businesses in the coming months, offering institutional investors over-the-counter (OTC) trading services and a flurry of digital asset investment products.

‘VARA’s thorough and consultative process provides institutional investors with the assurance they require to engage in this asset class,’ Jez Mohideen (right), CEO of Laser Digital, said.

Last month, Binance’s Dubai subsidiary Binance FZE also secured an operational minimum viable product (MVP) license from VARA, allowing the digital exchange to operate VA exchange services and VA broker-dealer services limited to intuitional and qualified retail investors in Dubai.

HK regulator sanctions HKVAX virtual asset trading platform

Hong Kong’s Securities and Futures Commission (SFC) has issued an in-principle approval to Hong Kong Virtual Asset Exchange (HKVAX) to conduct Type 1 and Type 7 regulated activities, making the firm the third licenced virtual asset operator in Hong Kong.

Once HKVAX receives the final approval from the SFC, the company said it will offer an OTC brokerage that allows users to trade between fiat and digital assets, an institutional-grade exchange platform, and an insured custody solution.

‘We welcome the changes proposed recently by the SFC that open up virtual assets to a wider community while providing investors of all types with the transparency, reliability and protection they expect,’ said Sam Fok (right), co-founder and chief operating officer at HKVAX.

“The changes also signal Hong Kong’s intent to become a global virtual asset hub.”

HKVAX’s approval comes after the SFC began accepting applications for cryptocurrency trading platform licenses on 1 June. In early August, HashKey and OSL became the first two licensed exchanges to offer cryptocurrency trading for non-professional investors in Hong Kong.

Genesis Trading: Crypto derivatives set to be the industry’s next growth driver

The cryptocurrency derivatives market is set to become the industry’s next growth driver as the spot market faced challenges from liquidity woes, according to a report by cryptocurrency lender Genesis Trading.

‘With spot market liquidity suffering and spot order book depth chronically flagging, it has become increasingly apparent that a significant portion of the future growth of crypto volumes will be in derivatives,’ stated the report. 

The report highlights several key developments in the cryptocurrency derivatives and options space during Q2 2023 such as the record of the number of option contracts traded in a 24-hour window: on the cryptocurrency options exchange Deribit as Bitcoin reclaimed the US$30,000 mark at one point in late June, or the significant increase in options volumes at the Chicago Mercantile Exchange (CME) which went up by nearly 25% in July to reach around US$1 billion.

‘The notional volume of equity options in the US exceeded the notional traded value of the underlying equities in 2021 for the first time. If following this traditional finance (TradFi) trend, the crypto options market has room to grow 10-fold from current levels,’ read the report.

Genesis expects a robust crypto derivatives market can usher in institutional adoption on a global scale.

Click here to read the full Genesis report.