Genesis is exploring institutional hedging and liquidity products for NFTs

The institutional market for non-fungible tokens is heating up, with Genesis Global confirming that it wants to build out its own platform to address the needs of large traders in this fast-growing corner of the crypto market. 

The firm, which traded $100 billion in spot crypto last year, said in its fourth-quarter report that it currently holds "curated NFT collateral" on behalf of certain clients. Indeed, much ink has been spilled explaining the unique role of NFTs in the broader crypto market amid the ongoing macro-driven rout. While liquid tokens have seen their prices collapse since the beginning of the year, the floor price of NFTs and volumes on marketplaces like OpenSea have ticked higher. 

The introduction of new institutional products could reinforce this phenomenon. 


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"It’s pretty clear there is a large cohort of whales that are always in the market, but what they are investing in is constantly changing," said one trader in the market.  "No one just goes to stablecoins to ride out the winter."

As for Genesis's new institutional platform, Genesis hopes it will serve as a destination to address "both liquidity and hedging requirements amidst recent high-profile raises of NFT venture funds."

"While this market is still in its nascent stages, we believe institutional adoption will continue to grow, and that the appetite for NFTs and metaverse ecosystems will continue to develop rapidly among both institutional and mainstream audiences," Genesis explained. 

NFT volumes have surged since the start of the year, with OpenSea setting a record after clocking in more than $3.5 billion in total volumes as of January 27, as per data from The Block. 

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Frank Chaparro is Host of The Scoop podcast and Director of Special Projects. He also writes a biweekly newsletter. Chaparro started his career at Business Insider, where he specialized in the intersection of digital assets and Wall Street, market structure, and financial technology. Soon after joining Business Insider out of Fordham University, Chaparro was interviewing top finance and tech executives, including billionaire Mark Cuban, “Flash Boys” star Brad Katsuyama, Cboe Global Markets CEO Ed Tilly, and New York Stock Exchange President Tom Farley. In 2018, he become a sought after reporter in the crypto world, interviewing luminaries such as Tyler Winklevoss, the cofounder of Gemini, Jeremy Allaire, the CEO of Circle, and Fundstrat head Tom Lee. For inquiries or tips, email [email protected].