In this week’s roundup, we look at the latest earnings from Galaxy Digital, the launch of Bybit wealth management, Bitstamp’s plan in derivatives and CME’s trading activities in July.
Galaxy Digital, one of the largest crypto derivatives manufacturers, has posted a US$46m net loss for the second quarter of the year, a rebound from the US$544m net loss in the prior year quarter.
Galaxy's operating businesses performed well in the second quarter against a backdrop of continued uncertainty and regulatory pressure - Michael Novogratz, Galaxy
However, compared to Q1 2023 when net income came to US$134.2m, it was a significant loss, primarily driven by lower net realised gains on digital assets and net unrealised losses on investments, partially offset by higher net realized gains on investments, according to the US firm’s Q2 2023 earnings report released today (8 August).
In the second quarter, operating expenses dropped US$85.2m, down 34% year-on-year, or down six percent quarter-on-quarter (QoQ).
For the global markets segment, trading revenue declined 54% to US$59.5m QoQ driven by lower net realised gains on digital assets and net derivatives gains. Cumulative counterparty-facing trading operational net revenue reached US$28.3m, down 25% QoQ, impacted by lighter volumes across derivatives and over-the-counter trading, according to the report.
‘Galaxy's operating businesses performed well in the second quarter against a backdrop of continued uncertainty and regulatory pressure, as we continue to manage the company to meet the evolving needs of our clients,’ said Michael Novogratz (right), founder and CEO of Galaxy.
Bybit unveils WM unit and plans to add structured products
The crypto derivatives exchange today (8 August) announced the launch of Bybit Wealth Management (WM), which allows all Bybit users to manage, plan and invest crypto with no fees. The assets are managed by third parties with no on-chain transactions occurring, according to Bybit.
The WM service will offer a variety of portfolios and investment strategies, including structured products, which will ‘be released soon’. The maiden product is ‘fund pool’, which employs risk-neutral strategies with a 30-day tenor and offers up to 4.5% pa on Tether (USDT), with early redemption options available.
‘All funds are safely held within Bybit, and all investment activities are seamlessly executed through our spot and derivatives platform,’ stated the company.
Bitstamp in fundraising talks to launch derivatives
The crypto exchange is currently in talks of fundraising and expects to use the proceeds to launch derivatives trading in Europe next year and to expand its offerings in the UK and Asia, said Jean-Baptiste Graftieaux, CEO of Bitstamp earlier this week.
‘Bitstamp is not for sale, and we are not actively looking to sell the company,’ said Graftieaux in a statement to Bloomberg. ‘Our current and exclusive priority is to raise money through strategic investors to accelerate Bitstamp’s growth by providing new products and services to retail and institutional crypto customers.’
In June, the bourse secured a new registration with UK’s Financial Conduct Authority (FCA) to function as a registered crypto asset firm after complying with anti-money laundering rules.
CME BTC options volume rises for the first time in four months
In July, the total derivatives trading volume on the Chicago Mercantile Exchange (CME) fell 17.0% to US$40.1 billion. In line with the general trend in the derivatives market, the futures volume on the exchange fell 17.6% to US$39.1 billion, with Bitcoin (BTC) and Ether (ETH) futures volume falling to US$31.3 billion and US$7.24 billion, respectively, according to the latest exchange review report by CCData.
However, options trading volume on the exchange rose 24% to US$940m, recording the first increase in four months. The BTC options traded on the exchange rose 16.6% to US$734m, while ETH options saw trading volumes rise 60% to US$207m.
‘The increase in BTC options volume on the CME suggests that institutions might be hedging their positions with options as uncertainty remains in the market,’ stated the report. ‘The derivatives volume on the exchange has also picked up in recent months, hinting at increased institutional interest in the market.’
Image: Laymanzoom/Adobe Stock.