Binance Expands TradFi Portfolio With Stock Options

Binance has begun offering customers of its cryptocurrency platform access to stock options.

“Stock Options are now live, offering physically-settled options contracts on U.S.-listed stocks and ETFs, giving users the right to buy or sell underlying shares at a predetermined strike price on a specific expiration date,” the world’s largest crypto exchange said Tuesday (Sept. 1).

Binance characterizes its options offering as part of a growing suite of traditional finance products, letting traders “express direction, hedge equity positions, and manage portfolio risk” from a single Binance account.

“I think using the crypto infrastructure for TradFi assets is very popular and it works very well,” Shunyet Jan, head of exchange and trading at Binance, said in an interview with Bloomberg News on the launch. “We are just giving what our users want and giving more choices.”

Jan added that the daily trading volume of perpetual futures tracking Sandisk recently exceeded that of bitcoin on Binance. The monthly volume of perpetual futures connected to traditional assets on Binance increased about 15-fold to about $445 billion in July from $30 billion in January, according to company figures provided to Bloomberg.

That report notes that the crypto sector has long contended perpetual futures are a simpler product than options for retail traders, with no expiration dates, and offering straightforward long or short leveraged exposure. However, Jan told Bloomberg options still provide some benefits not found with perpetual futures.

“Crypto exchanges have been popular with perpetuals, but I do see a lot of players that want options you can’t get liquidated, you could get more direct dates,” Jan said. Options are “more precision. So it is an interesting tool for a subset of users.”

In other news from the intersection of digital assets and traditional finance, PYMNTS wrote Tuesday about a new consortium of global banks — including Citi, Goldman Sachs, Wells Fargo, MUFG and Deutsche Bank — that will establish a business focused on stablecoins.

“Banks are not abandoning tokenized deposits in favor of stablecoins. They are increasingly building both,” that report said.

“That turns what has often been framed as a contest between competing versions of digital money into something more consequential: an effort by banks to assemble a portfolio of programmable money and eventually route transactions toward whichever form has the right combination of liquidity, portability, regulation and reach.”