APAC Derivatives Market Undergoing Structural Transformation

Key themes 

• Convergence of listed and OTC markets in integrated client risk strategies 
• Energy transition and carbon markets driving new hedging demand 
• Expanding regional participation through liberalisation, new exchanges and digital innovation 

 StoneX’s Lian Tuck Lee, Head of Listed Derivatives, Asia, and Darren Lim, Vice President for Commodities, Asia, shared their perspectives on the evolving APAC derivatives landscape in a recent interview with Futures & Options World. 

 They emphasised that innovation increasingly lies in the interaction between listed and over-the-counter (OTC) markets. Where listed markets provide transparency, standardisation and benchmark liquidity, OTC markets offer flexibility and customised risk management,  particularly in commodities. 

 “Our strength is bridging these two worlds — giving clients access to exchange liquidity while tailoring OTC solutions to portfolio nuances,” said Lim. 

Energy Transition Reshaping Demand 

Demand across APAC for battery metals, LNG and carbon continues to accelerate as the region advances the energy transition. 

“Battery metals such as lithium, nickel and cobalt are central to the energy transition, driving demand for robust hedging instruments,” said Lee. 

LNG volatility is supporting activity across both listed benchmarks and OTC swaps, while carbon markets are expanding through compliance schemes such as China’s Emissions Trading System and Singapore’s International Carbon Credit Framework. 

Expanding Regional Participation 

New exchanges are introducing contracts tailored to Asia-specific flows, including LNG, battery metals and carbon. 

“As the first clearing member of the Singapore-headquartered Abaxx Exchange, we’re reinforcing our commitment to enabling clients to access these new benchmarks,” said Lee. 

Meanwhile, the gradual liberalisation of Chinese commodity derivatives markets is increasing global participation. 

“Liberalisation will deepen liquidity, align Chinese prices with global markets, and create arbitrage opportunities,” Lee noted. 

As Chinese contracts gain global relevance, StoneX supports cross-border hedging strategies and OTC overlays designed to manage basis risk between Chinese and international benchmarks. 

Tokenisation and Market Access 

Tokenisation is beginning to influence market participation by enabling fractional ownership and expanding access to real-world assets. 

“By lowering barriers to entry, tokenised real-world assets attract a wider spectrum of investors and generate new demand for hedging instruments,” said Lee. 

While StoneX does not issue tokenised assets, it supports clients in hedging underlying exposures through listed futures and customised OTC structures. 

Learn More About StoneX’s APAC Derivatives offering 

Interested in speaking to the experts in the APAC region’s dynamic derivatives markets? Reach out to StoneX’s team to learn what solutions can help your business navigate rapidly evolving landscape. 

Read the original article here.   

-- Experts: Lian Tuck Lee, Head of Listed Derivatives, Asia; Darren Lim, Vice President for Commodities, Asia at StoneX 
-- Authors: Lindo Xulu, Gus Farrow