Global derivatives markets are experiencing a transformative moment in 2025, driven by a powerful combination of heightened volatility and structural innovation. With trading volumes hitting record highs in the first half of the year, market participants are turning to advanced technologies—particularly generative AI and tokenization—to help manage operational complexity and scale for continued growth.
According to the How firms will manage the growing derivatives market study by Crisil Coalition Greenwich, 70% of the industry professionals surveyed expect trading volumes to continue rising this year. While much of the early growth has been fueled by tariff-induced market volatility and geopolitical uncertainty, industry leaders believe these volumes will be sustained by broader, secular changes in the global financial system.
“As volumes grow and new regions become more integral to the derivatives market structure, operational risk increases, and capacity challenges become more pronounced,” said Stephen Bruel, Senior Analyst on the Market Structure & Technology team at Crisil Coalition Greenwich and author of report. “The industry will need new solutions to help manage this rapid growth.”
The solutions most widely viewed as game changers are generative AI and tokenization in collateral management. Over a five-year time horizon, 35% of respondents identified AI as the single most promising tool to expand industry capacity, while nearly a third pointed to tokenization.
“Derivatives workflows can be notoriously complex, and AI applied to processes such as reconciliations could alleviate some of the burdens,” Bruel explained. These burdens are especially evident in the manual, document-heavy processes that underpin much of derivatives trading—from onboarding and margining to legal reviews of ISDA agreements. AI’s ability to analyze large datasets and automate decision-making is particularly suited to this environment.
Buy-side institutions are especially bullish on AI, with 43% ranking it as the most impactful innovation over the next five years. The sell-side, which faces more complex margin and collateral requirements, is more evenly split—29% favor AI, while 32% prioritize tokenization.
Tokenization, meanwhile, has emerged as a promising answer to persistent collateral inefficiencies. In today’s high-volatility environment, counterparty credit risk is elevated, and smooth, timely collateral movement is essential. Yet many firms still grapple with outdated systems and operational bottlenecks. By digitizing and automating the management of collateral assets, tokenization offers the potential for faster, more secure, and more flexible collateral deployment.
Capacity constraints are not just technological—they’re regulatory and financial as well. Basel III capital requirements continue to limit how much risk banks can take on, regardless of market appetite. While potential regulatory relief may ease the pressure in some jurisdictions, capital remains a finite resource. Technologies that improve operational efficiency and lower costs can help firms reallocate capital more strategically, preserving market access as volumes rise.
The industry’s shifting priorities are evident in the data. Just a year ago, operational standards were viewed as the top lever for improving efficiency, with 35% of respondents ranking them first. In 2025, generative AI has overtaken that position, signaling growing confidence in the technology’s maturity and applicability. Still, standards remain critical to enabling scale. The exchange-traded derivatives (ETD) workflow is still plagued by manual processes, creating risks that scale with volume.
As firms strive for greater control, collaboration, and consistency across operations, automation and standardization are emerging as parallel imperatives. For sell-side institutions operating in low-margin businesses like futures trading, scale is essential for protecting profitability. On the buy-side, intense competition and fee pressure drive the need for cost efficiency and differentiated client service.
The adoption of AI and tokenization is not just a response to growth—it’s a prerequisite for managing it. As more asset classes—from crypto to commodities—and more participants—particularly retail investors—enter the market, the operational burden will only increase. Technologies that streamline risk management, reduce friction, and enable real-time responsiveness will define the next generation of derivatives infrastructure.
