Binance will expand its TradFi products through perpetual futures contracts, pivoting on rising demand for stocks and precious metals. New contracts are expected soon, after the exchange started with silver and gold trading.
Binance joined a growing number of crypto exchanges in offering access to traditional asset trading. The rise of stocks and metals opened the door to creating markets based on both centralized and on-chain infrastructure.
Binance joined Bybit and Bitget in generating pairs for silver and gold on its perpetual futures markets. The exchanges took an approach usually reserved for tokens to track the performance of precious metals and stocks.
The new markets will be available through the newly announced Binance TradFi Perpetual Contracts. Products and services may be regionally restricted.
Binance competes with tokenized stocks
The shift to TradFi markets starts competing with the drive for tokenized shares. Recently, tokenized shares reached peak value locked, although their growth has been relatively conservative by the standards of crypto markets.
Kraken has emerged as the first mover in offering XStocks, while Bitget expanded other types of tokenized markets.
The main obstacle to trading tokenized shares is regulation and the exact ownership of shares and tokens. Perpetual futures and prediction markets on stock and commodity prices can launch more easily, with fewer restrictions. Binance has chosen this path, opening the door to the relatively easy addition of TradFi price contracts.
Binance will use its model for perpetual futures, settled against USDT. The perpetual contracts have no expiration date and are open 24/7. The TradFi market will be added under the Binance Futures brand.
The Binance market will reflect the opening hours of traditional markets when supplying price information. Outside trading hours on global exchanges, the market will allow limited price deviation.
Binance offers regulated futures trading
In addition to using its USDT trading infrastructure, Binance TradFi futures offers a fully regulated platform. The exchange launched the trading under the Abu Dhabi Global Market framework.
The Binance TradFi Futures are traded on the Nest Exchange Limited and cleared by the regulated clearing house Nest Clearing and Custody Limited. The futures market will calculate and stabilize prices based on the 25/5 schedule for precious metals, with no price discovery on weekends.
As the TradFi futures use USDT for settlement, the products may not be available for EU-based traders.
In the initial trading hours, gold had more advanced activity, with $24M in daily volumes and $5.7M in open interest. The futures market still lags behind XAUt tokenized gold trading, which achieved $291M in daily trades. XAUT also traded at a slight premium of $4,425 per token, representing an ounce of gold.
The silver market is even smaller, with under $250K in daily volumes, as silver is down from its recent highs to $75 per ounce. With new types of assets, Binance may also tap international demand for US stocks, offering a regulated and more secure market for exposure to some of the most active assets for the past year.
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