- Deribit and Crypto.com now allow institutional traders to use BUIDL as collateral for leveraged crypto trading.
- BUIDL offers steady yield and low risk which helps reduce margin requirements and free up capital for other trades.
- Tokenized treasuries like BUIDL are gaining traction as stable collateral options across leading crypto trading platforms.
Deribit and Crypto.com have started accepting BlackRock’s tokenized U.S. Treasury fund, BUIDL, as a trading collateral. This change applies to institutional and advanced traders. The update allows them to use a low-volatility, yield-bearing asset to back leveraged trades.
BUIDL is backed by short-term U.S. Treasuries. The Treasury Fund is less volatile than cryptocurrencies and offers a steady yield. This makes it a useful alternative to traditional crypto collateral like Bitcoin or stablecoins.
By using BUIDL, traders can reduce margin requirements. This gives them more flexibility to use capital across other positions. The fund currently pays an annual yield of around 4.5%.
Lower Risk and Higher Efficiency for Institutions
Deribit will support BUIDL for futures, options, and spot trading. Crypto.com’s leadership emphasized that BUIDL will be available to qualified institutional customers across all its services. This includes spot, margin, derivatives, and over-the-counter trading. The move aims to enhance the trading experience for advanced users while expanding collateral options.
Only institutional and experienced traders will have access to this feature. The exchanges expect it to help their users manage risk more efficiently. BUIDL is now considered a safer collateral option due to its U.S. Treasury backing.
The tokenized fund also brings yield to otherwise idle collateral. This helps improve capital efficiency for traders who want to stay active in volatile markets. As BUIDL is less risky, platforms can lower the required collateral amounts.
This will open access to institutional clients holding U.S. dollars but not crypto. These clients can enter the market without converting large sums into digital currencies.
BUIDL Expands Tokenized Treasury Use in Crypto
BlackRock launched BUIDL in March 2024. It now manages $2.9 billion in assets. It controls nearly 40% of the tokenized Treasury market.
The fund runs on Ethereum and other blockchains. These include Optimism, Polygon, Arbitrum, Avalanche, and Aptos. This multi-chain approach increases its reach in both centralized and decentralized markets.
Tokenized U.S. Treasuries now hold over $7.3 billion in value. Ethereum remains the top network for these assets, with BUIDL as the leading product.
Other firms like OKX and Binance are expected to adopt BUIDL soon. Its use as collateral is growing fast across platforms. It is already in use by Frax Finance to collateralize its stablecoin, frxUSD.
This transition to real-world asset-based collateral signals a larger trend. Traditional finance products have been integrated with digital trading tools in exchanges to enhance security and performance.
