Singapore Banking Giant DBS Tiptoes Into Crypto Amid Asia’s Fading Market Spark

Key Takeaways

• DBS has announced extended crypto options for its institutional and accredited clients.
• Asia’s exchange-traded fund market has been struggling.
• DBS will offer financial products linked to the value of the price of Bitcoin and Ethereum.

Singapore-based banking giant DBS has become the first Asian bank to launch crypto options and structured notes for institutional investors and accredited wealth clients.

The bank will offer financial products linked to the value of the price of Bitcoin (BTC) and Ethereum (ETH).

Digital Asset Portfolios With DBS

Beginning in Q4 2024, clients working with Bitcoin and Ethereum will also be able to hedge their positions against market volatility and earn yield through trading options, DBS announced in a Sept. 17 press release.

Jacky Tai, Group Head of Trading and Structuring in Global Financial Markets at DBS, said that professional investors are increasingly allocating to digital assets in their portfolios, adding that “these financial products are an expansion of the bank’s value proposition to provide clients trusted institutional-grade access to the digital asset ecosystem.”

More crypto options being launched in DBS reflect the nation’s increased support for fintech innovation and could play a key role in boosting the adoption of digital assets in the country.

Asian Crypto ETFs Are Having a Hard Time

Despite the increased adoption of crypto in Singapore’s banks, Asia’s exchange-traded fund (ETF) market has been having a hard time.

In April, the Hong Kong Securities and Futures Commission (SFC) approved six spot ETFs, but their launch failed to provide thriving returns. 

Asia’s biggest BTC and ETH ETFs have shown unfortunate returns of just -5% to -20%, marking a massive decrease from their initial expectations. 

Hong Kong Crypto Market Underwhelms 

Hong Kong has been attempting to position itself as a global leader in the cryptocurrency industry by introducing new regulatory frameworks. The frameworks aim to strike a balance between fostering innovation and ensuring investor protection. 

However, despite the government’s efforts, it appears the overall market appetite for ETFs is not up to scratch. 

The trading volume and AUM of Asia’s ETFs have been fledgling, possibly due to a lack of investor interest in the products. 

In a survey of 100 attendees at a blockchain event in Taiwan by Nikkei, zero investors expressed interest in investing in ETF products.