Zerocap Transfers Derivative Collateral to Fireblocks' Off-Exchange Custody

Zerocap has transferred its derivative trading collateral from Deribit to Fireblocks' "off-exchange" structure. This method allows assets held in custody to be recognized as margin instead of depositing collateral in an exchange account. Zerocap operates as a global market maker under an Australian financial services license, providing services to institutional and wholesale clients across Asia, Europe, the Middle East, and the Americas. The off-exchange structure is designed to reduce counterparty risk for exchanges, where previously collateral had to be deposited in exchange accounts. In Fireblocks' structure, collateral is stored in a multi-party computation (MPC) based on-chain wallet, which the exchange recognizes as margin. Deribit announced its integration with Fireblocks in February 2024, allowing for collateral verification without directly holding customer assets. Zerocap trades perpetual contracts, futures, options, and spot products on Deribit, and Fireblocks has reported that Zerocap's structured product ledger has increased from millions to tens of millions of dollars. Fireblocks announced the launch of off-exchange in November 2023, with Deribit as the first integrated exchange. However, while the risk of leaving collateral with the exchange is reduced, legal and operational risks still remain. Coinbase is set to complete its acquisition of Deribit by August 2025.

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