The line separating crypto derivatives from traditional finance has all but dissolved, and the two markets are now so intertwined that perpetuals, once a pure crypto instrument, could soon be as much a stock trading product as a crypto product.
That’s the takeaway from the “Digital Asset Derivatives: Building Ecosystems and Establishing Opportunities” panel at Consensus 2026 in Miami this week. Krista Lynch, senior vice president of ETF Capital Markets at Grayscale; Mike Harvey, Head of Franchise Trading at Galaxy and Griffin Sears, Head of Derivatives at FalconX – three executives from different market trajectories – all converged on the same point, with the case based on working infrastructure rather than hype or vision.
Harvey gave a bold expression of where this convergence is leading. “There’s been a lot of talk about tokenized stocks, and within the next two or three years, the volume of offshore traded stocks will outnumber crypto-perps,” Harvey said.
Perps, short for perpetual futures, are a type of derivative widely used in crypto markets, especially on offshore unregulated exchanges. They are similar to traditional futures, but with one important difference: they do not have an expiration date. As the name suggests, you can hold the perpetual contract forever.
By early 2026, derivatives accounted for more than 70% of global crypto trading, led by perpetual futures. Monthly volumes regularly reach trillions of dollars. While perpetuities tied to traditional assets such as oil, stock indices and individual stocks have seen a surge in interest on platforms such as Hyperliquid and Binance, particularly during periods of geopolitical volatility, their share of overall activity remains limited.
Harvey expects this segment to become dominant in the coming years. His point is that the necessary infrastructure to bring stocks to blockchain rails is already in place, and it doesn’t care what asset sits on or trades on top of it. Day-to-day operations at Galaxy underscore this reality.
“As traders, we are the glue that holds these markets together. We have to have the ability to move natively between an offshore exchange, an onshore exchange, futures, ETFs,” he said.
In other words, the boundaries between different markets and venues have been operationally dissolved, leaving volume to follow.
The regulatory foundation facilitating convergence is more advanced than most market participants realize. Regulatory clarity has been the single biggest driver, specifically the Securities and Exchange Commission’s generic listing standards, which she said drew formal attention to the link between derivatives and spot ETFs’ eligibility, Lynch said.
“Having a derivative on an underlying crypto token is kind of an indication that it should also be available in the spot format,” she added. The standards establish three pathways for a protocol to become ETF-eligible in spot form, two of which run directly through derivatives. One requires a futures market that has been in existence and under the supervision of a regulator for a certain period of time. The second, which Lynch acknowledged, is a “little hairpin” allowing spot eligibility if an ETF already provides meaningful exposure to an underlying asset through swaps or similar instruments.
“There’s a lot of continuity between the two worlds,” she said.
FalconX’s Sears pointed in the same direction throughout the panel. Crypto sites, including decentralized exchanges, already offer contracts tied to precious metals and commodities as an extension of their perpetual offerings, he noted. But the more structural option, Sears said, lies in cross-margining, where a trader can use different asset classes as collateral against each other within the same account. Talk about unlocking capital efficiency by bringing TradFi assets onto blockchain rails!
“What is really strong for all the participants in the space will be the cross-cutting potential that RWA [real-world asset tokenization] can unlock,” Sears said. “And I think that benefits the industry as a whole.”
Sears expects a traditional financial asset to be among the top five by volume on a crypto exchange. His closing call went a step further. “Not only will trading volume grow, but I think we’ll also see direct IPOs, direct listings of stocks on chain instead of traditional venues,” Sears said. “And it’s going to be an extremely exciting moment to see billion dollar IPOs happen completely onchain.”
The panelists also pushed back on the conventional framing of this convergence. The common assumption is that traditional finance is taking over crypto and blockchain, that is, banks, asset managers and exchanges are adopting digital assets on their own terms.
“It’s crypto that’s actually bringing the TradFi rails on chain and forcing all these traditional exchanges to innovate up to the level of where crypto derivatives are,” he said.
The 24/7 trading and settlement model that crypto markets pioneered is now something that all major traditional exchanges have publicly strived to replicate, a sign that innovation is flowing in one direction.
The market for IBIT options offers perhaps the starkest illustration of this velocity. In less than two years, options on BlackRock’s spot bitcoin ETF became a top-five ETF globally by options volume, Sears noted.
