The line separating crypto derivatives from traditional finance has all but disappeared, and the two markets are now so closely intertwined that perpetuals, once a purely crypto instrument, may soon be as much a stock trading product as a crypto product.
That’s the key takeaway from the “Digital Asset Derivatives: Creating 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 sectors of the market – all converged on the same point, with the deal being built on functional infrastructure rather than hype or vision.
Harvey boldly expressed where this convergence is leading. “There has been a lot of talk about tokenized stocks, and in the next two or three years, the volume of stocks traded overseas will be greater than crypto stocks,” Harvey said.
Perps, short for perpetual futures, are a type of derivative widely used in crypto markets, particularly on unregulated offshore exchanges. They are similar to traditional futures contracts, but with one key difference: they do not have an expiration date. As the name suggests, you can keep the perpetual contract forever.
By early 2026, derivatives accounted for more than 70% of global cryptocurrency trading, led by perpetual futures. Monthly volumes regularly reach billions of dollars. Although perpetual securities linked to traditional assets like oil, stock indices and individual stocks have seen renewed interest on platforms like Hyperliquid and Binance, particularly during periods of geopolitical volatility, their share of total activity remains limited.
Harvey expects this segment to become dominant in the coming years. His view is that the infrastructure needed to get stocks on the blockchain track is already in place, and it doesn’t matter what asset is located or traded on it. Daily operations at Galaxy underscore this reality.
“As brokers, we are the glue that holds these markets together. We must have the ability to scale natively between an offshore exchange, a domestic exchange, futures and ETFs,” he said.
In other words, the boundaries between different markets and locations have been dissolved operationally, and all that remains is to ensure that volume follows.
The regulatory work facilitating convergence is further along than most market participants realize. Regular clarity has been the main driver, particularly the Securities and Exchange Commission’s generic listing standards, which she said have brought formal attention to the link between derivatives and cash ETF eligibility, Lynch said.
“Having a derivative on an underlying crypto token kind of indicates that it should also be available in spot format,” she added. The standards establish three pathways for a protocol to become eligible for the spot ETF, two of which are directly through derivatives. The first requires an existing futures market under the supervision of a regulator for a defined period. The other, which Lynch acknowledged is “a little hairier,” allows cash eligibility if an ETF already provides significant exposure to an underlying asset through swaps or similar instruments.
“There’s a lot of continuity between these two worlds,” she said.
FalconX’s Sears pointed in the same direction throughout the panel. Crypto platforms, including decentralized exchanges, already offer contracts linked to precious metals and commodities as an extension of their perpetual offerings, he noted. But the most structural opportunity, according to Sears, 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 the blockchain!
“What’s really powerful for all participants in this space will be the cross margin potential that RWA [real-world asset tokenization] can unlock,” Sears said. “And I think it benefits the industry as a whole.”
Sears expects a traditional financial asset to rank in the top five by volume on a crypto exchange. His closing call went even further. “Not only is trading volume going to increase, but I think we’re also going to see direct IPOs, direct stock listings on chains instead of traditional venues,” Sears said. “And it will be an extremely exciting time to see billion-dollar IPOs happening entirely on-chain.”
The panelists also pushed back against 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 putting the TradFi rails in place and forcing all these traditional exchanges to innovate to the level where crypto derivatives are,” he said.
The 24/7 trading and settlement model pioneered by crypto markets is now something that all major traditional exchanges publicly aspire to replicate, a sign that innovation is moving in one direction.
The IBIT options market offers perhaps the most striking illustration of this speed. In less than two years, options on BlackRock’s bitcoin spot ETF have become one of the top five ETFs in the world by options volume, Sears noted.
