Maple Finance has just rolled out a new derivatives product designed for institutional investors looking for digital assets. This offering allows investors to buy Bitcoin call options using the yield from collateralized crypto loans.
To participate, investors need a minimum buy-in of 100,000 USD Coin. This product offers exposure to Bitcoin while providing some downside protection against its potential underperformance. It features a floor annual percentage yield (APY) of 4%, with a chance to reach a maximum APY of 33%.
Maple's new product will face competition from several similar offerings. For instance, there's the Bitcoin investment fund from the National Bank of Bahrain and protected Bitcoin exchange-traded funds (ETFs) from Calamos Investments. Crypto.com has also launched a platform aimed at institutional investors in the U.S.
Since 2024, structured crypto products for institutional investors have been on the rise. This growth is fueled by clearer regulations and a broader acceptance of cryptocurrencies as legitimate investments. Many of these products aim to reduce downside risk, which is a significant concern for investors. Lucas Kiely, the chief investment officer for Yield App, points out that seasoned investors want reassurance that their investments won’t just vanish, like what happened with FTX, Celsius, and Terra back in 2022.
More and more, institutional investors see Bitcoin and other digital assets as essential parts of their portfolios. They help with diversification and serve as a hedge against inflation. Since their introduction on Wall Street in January 2024, Bitcoin ETFs have attracted over $39.9 billion in net inflows.
In June 2023, Maple Finance launched a direct crypto lending program to fill the gap left by the collapses of BlockFi and Celsius. According to HTF Market Intelligence, the Bitcoin loan market is expected to grow at a compound annual growth rate of 26.4% until 2030. The market size is projected to expand from $8.6 billion to $45 billion.