Rho Labs is delighted to announce that Rho Protocol, the first institutional-grade market for crypto interest rates, will be publicly launched on March 31. After a successful period in private beta mode, Rho’s crypto funding rate and staking rate futures will be open for trading.

Built on Arbitrum, Rho has transformed crypto interest rates into a liquid, tradeable asset class, giving hedge funds, trading firms, DAOs, and institutional investors capital efficient tools for hedging and deploying profitable rate strategies. With nearly $10B in notional volume traded just during the beta stage, Rho has already established itself as the go-to-venue for trading crypto rates.

Why Crypto Needs a Rates Exchange

Rho’s launch represents a milestone in the maturation of the crypto ecosystem. As the functioning of the crypto market starts to represent traditional markets more and more closely, rates, as the single largest asset class in traditional global financial markets, will play an increasingly important role in the functioning of the ecosystem.

Speaking about the launch, Alex Ryvkin, Founder of Rho Protocol commented; “We’re excited to be launching Rho to the public market. Since we founded Rho in 2022, we have observed an evolution of crypto markets with rates, especially perp funding and staking, becoming a critical component of crypto traders’ portfolio returns. With the backing of some of the most reputable VCs in TradFi and Web3 and some of the most respected liquidity providers in the space, we are well-positioned to execute our vision of building a robust and reliable rates market for the blockchain ecosystem, contributing to its maturity and RWA future-readiness.”

Below is a summary of the products available on the platform at launch:

Rho’s Perpetual Funding Rate Futures market enables users to trade the opportunities presented by funding rate fluctuations as well as hedge against unpredictable funding rate changes, ensuring more consistent portfolio returns and improved Sharpe ratios. Users can take positions on the funding rate of BTC or ETH perpetual swaps on a number of centralized and decentralized exchanges, including Binance, OKX and Bybit to hedge or profit from funding rate fluctuations.

Rho has created the first liquid staking rates market referencing the CESR™ (the Composite Ethereum Staking Rate, developed by CoinDesk Indices and CoinFund). On Rho, positions can be taken in Ethereum staking rates for a wide range of maturities, starting from one month to one year or longer. This gives traders the opportunity to hedge rates, which are often volatile, and to exploit future fluctuations in Ethereum staking yields. Rho’s Staking Rate Futures allow users to lock in fixed yields on Ether staking rewards, mitigating the risk of volatile staking rate changes, creating stable, sustainable returns.

Rho incentivizes liquidity providers to supply capital to vAMMs (virtual automated market makers) on the platform. Rho’s virtual Automated Market Maker (vAMM) is a next-generation rate market-making mechanism. Unlike traditional AMMs, which rely on continuous liquidity pools, Rho’s vAMM introduces a capital-efficient model optimized for trading rate derivatives.

Passive returns in on-chain rate markets can be generated with the Rho Liquidity Vault, which functions on a market-neutral liquidity strategy, providing market-making functions to Rho Protocol’s vAMMs.  Users deposit into the vault to provide liquidity and in return receive a portion of the trading fees that the vault earns. Furthermore, the vault provides liquidity for liquidations. Additional fees can be earned when liquidations are actioned.

Rho recently completed a $4m seed funding round, backed by Coinfund, Flow Traders, Auros and Speedinvest. With the new funding, Rho Labs plans to enhance liquidity, onboard institutional participants, and develop non-custodial trading solutions.

On the announcement of the seed funding, Alex Felix, Co-Founder and Chief Investment Officer of CoinFund commented:

“We are thrilled to support Rho Labs as they fill a critical gap in the crypto ecosystem with a marketplace of perpetual products to normalize funding and forward rates between CeFi and DeFi. Rho Labs is built by capital markets professionals to serve the budding credit opportunity. We strongly believe in Alex and his team as sophisticated institutional players to deliver the future of rate derivatives in crypto.”

Source: Rho Labs