Bitget x Reality x Keyring: Decentralizing Equity Basis Strategies with rToken

Bitget and Keyring are collaborating to develop a rules-based equity basis index and build a related on-chain lending market using Reality's rToken.

Reality provides tokenized equity exposure, while Keyring develops the index methodology and builds the related lending market. The index aims to combine rToken positions with offsetting equity perpetual contract positions to capture funding rate and basis opportunities. Some products are planned for distribution via Bitget Earn, subject to product review, eligibility requirements, and availability.

This collaboration integrates Reality's tokenized equity infrastructure, Keyring's rules-based investment strategies and lending markets, IPOR Fusion's on-chain vault infrastructure, and 1Token's portfolio management and risk monitoring tools. The partners will jointly explore how these components can support the development of on-chain equity basis products while addressing the operational, liquidity, and risk management challenges of strategies spanning traditional and decentralized markets.

Bitget and Reality: Equity Basis Strategy

Reality provides on-chain equity exposure through its rToken. Traders can purchase rToken via Bitget Exchange or Bitget Wallet X, or directly through Reality's Request for Quote (RFQ) service.

Reality's rToken forms the on-chain equity position in a basis trade and can also serve as collateral in the related lending market. Reality's RFQ service and Bitget Wallet support access to rToken liquidity and trade execution infrastructure, enabling eligible participants and vaults to obtain tokenized equity exposure, subject to applicable settlement conditions.

Tokenized equities allow equity exposure to connect directly with decentralized lending and investment infrastructure, making it easier for on-chain strategies to participate in basis trades. Unlike traditional equities, which typically require separate brokerage and financing arrangements, rToken can serve both as the equity position in a basis trade and as collateral in on-chain lending markets. This allows investors to combine tokenized equity positions with offsetting perpetual contract positions while using decentralized infrastructure to manage funding and execute rules-based strategies.

Equity Basis Trading with rToken

A risk premium is the additional return above the risk-free rate that traders receive for bearing a particular risk. Basis refers to the spread or difference between the spot price and the total return of the corresponding contract or perpetual contract.

Equity basis trading aims to capture funding fees paid by longs to shorts.

Data source: Keyring Research, January–July 2026

When the funding rate is positive, traders can earn funding fees by holding the corresponding rToken and shorting its perpetual contract. This operation aims to hedge equity price exposure, creating a delta-neutral basis trade.

Decentralization of Basis Trading

“Equity basis strategies have historically relied on centralized exchanges to manage spot and derivatives positions within a unified margin framework. Cross-margin mechanisms allow the profits and collateral value of one position to support the margin requirements of other positions in a portfolio, reducing the need to maintain separate collateral buffers for each trade.

However, concentrating custody, trade execution, and margin management in a single intermediary introduces counterparty and operational risks. The failures of several large centralized market participants have increased market attention to structures that can separate these functions while still maintaining the capital efficiency required to manage hedged positions.

Decentralized lending and trade execution infrastructure offers an alternative, enabling tokenized equity collateral, financing arrangements, and derivatives exposure to be managed across multiple interconnected protocols. Although this approach can reduce reliance on a single intermediary, it also introduces risks related to smart contracts, cross-chain bridges, price oracles, and liquidity fragmentation. Therefore, effective risk management requires reliable collateral valuation, sufficient margin buffers, and coordinated execution across trading venues.”

Lending Markets as a Source of Leverage

Lenders deposit stablecoins into the lending pool. Borrowers purchase Reality's rToken and deposit it as collateral. The pool lends stablecoins against that rToken collateral. Borrowers pay interest to the pool, and the pool distributes interest to lenders after deducting fees. If the loan size is excessive relative to the collateral value, the pool may sell the collateral.

This structure can serve as a source of leverage, enabling borrowers to build larger positions using collateral assets listed on the market. This practice is commonly referred to as 'looping' in the DeFi industry, allowing borrowers to gain leveraged exposure to tokenized stocks without opening a margin account on an exchange.

The financing function of this collateralized lending structure is similar to repurchase agreements (repo) in traditional markets, enabling investors to obtain financing against their tokenized stock positions.

For eligible Bitget users, the proposed lending structure may enable them to earn returns generated by overcollateralized lending using rToken as collateral, with the actual return level depending on borrowing demand, applicable fees, collateral valuation, and liquidation risk. Keyring introduces an institutional-grade risk framework (i.e., ISDA standardized initial margin model parameters) into its decentralized lending framework, providing a structured approach to managing collateral and margin requirements.

Stablecoin lending and equity basis index exposure are two distinct products. Stablecoin lenders earn interest paid by borrowers, net of applicable fees. Index investors receive the net performance of the combined rToken and perpetual futures strategy, including funding fees and basis gains or losses, after financing and trade execution costs. The index performance shown below does not represent the returns earned by stablecoin lenders.

A key issue to watch is that the value of rToken positions in the lending market must be balanced against short positions on Hyperliquid, and the lending market must correctly value rToken prices. This is why cross-margin mechanisms are critical in any market.

Reality's rToken price oracle uses official price sources during regular US equity trading hours and Hyperliquid quotes outside those hours. These price data support collateral valuation, while cross-venue margin hedging depends on the applicable market and account arrangements. The basis strategy also requires coordinated management of lending positions and perpetual futures margin.

For example, if the US equity market is closed and the corresponding perpetual futures price falls sharply, the rToken collateral valuation may also decline because the oracle uses Hyperliquid quotes outside regular trading hours. Even if the underlying stock has not traded during that period, this may reduce the borrowing capacity of the lending position and could trigger liquidation. At the same time, gains from the short perpetual futures position do not automatically offset the decline in collateral value across protocols. This highlights the importance of coordinated margin management, reliable price data sources, and sufficient liquidity for position management during periods of market volatility.

The liquidation process uses Keyring's [un]wind product and connects with Reality RFQ to coordinate collateral redemption and debt repayment. Settlement may need to be completed across multiple trading days during regular US equity trading hours. This mechanism is designed to support orderly liquidation of large rToken positions, with specific outcomes depending on redemption capacity, settlement timing, and final recoverable proceeds.

On-chain index strategies

Reality's rToken provides the on-chain equity positions underlying these index strategies.

Quantitative Investment Strategies (QIS) are a widely popular product class traditionally created by investment banks and issued to clients who wish to capture known market inefficiencies (i.e., risk premia) in a transparent manner.

Smart contracts can automate portions of index calculation, trade execution, and risk management that have traditionally relied on centralized financial intermediaries. They provide a programmable framework for implementing rules-based strategies, enabling automated execution, transparent risk parameter setting, and integration with decentralized finance infrastructure. IPOR's Fusion vault infrastructure executes pre-set investment mandates through smart contracts, enforcing the permitted asset universe, authorized markets, risk limits, and trade execution rules. This makes the strategy fully programmable while ensuring that its implementation strictly follows the established rulebook.

In strategy construction, a common challenge for QIS is ensuring that strategies correctly capture potential risk premiums in a scalable manner. To this end, a simple and robust rulebook is essential.

Decentralized and Robust Strategy Rulebook

The index follows a rules-based methodology built around three core steps:

1. Identify eligible tokenized stocks and the scope of the corresponding perpetual futures markets.
2. Rank eligible basis opportunities over the past three weeks.
3. Allocate capital based on pre-set portfolio construction, liquidity, and risk management constraints.

The complexity lies in how to handle contingencies in a decentralized, trustless manner. For example, setting margin buffer rules for cross-chain bridge failures is one instance; another is how to incorporate transaction costs and properly address slippage and trade execution issues.

The following analysis evaluates the historical performance of the rules-based stock basis index based on simulated net funding fee returns for the period from December 15, 2025 to October 19, 2026. The dataset is divided into an in-sample period used to determine strategy parameters and an out-of-sample period used to assess performance outside the initial calibration window. The simulation also considers trading constraints, transaction execution costs, financing assumptions, and portfolio concentration limits.

All of the above results are based on historical simulations, are sensitive to the assumptions used, and may not reflect actual trading execution or future market conditions.

The index was also compared with a theoretical maximum-return portfolio constructed using future market information. This hypothetical benchmark measures the highest cumulative return achievable under the trading constraints set by the model, including daily volume limits, slippage, concentration limits, and margin requirements. Because it relies on information that was not available to investors at the time of trading, it serves only as a retrospective reference and does not represent an investable strategy.

It should be noted that the index always maximizes asset allocation, so the signal contains no tactical risk overlay mechanism. This means that when funding rates turn sharply negative (as in April), even the optimal portfolio incurs losses because there is no premium to capture at that time. It is also worth noting that in certain periods (such as March and July), the optimal portfolio underperformed our index. Because of daily trading limits, positions take time to open and close, so choices that improve overall returns over the full period may reduce returns in a particular week. Under the simulation assumptions, the index recorded a Sharpe ratio of approximately 6 in the in-sample period and more than 9 in the out-of-sample period. The simulated maximum drawdown was approximately 60 basis points and occurred in the in-sample period. The above results reflect outcomes under the historical dataset and modeling assumptions and should not be interpreted as indicative of future performance.

The simulated index had an annualized net return of approximately 7% in the in-sample period and approximately 4% in the out-of-sample period, while the theoretical maximum-return portfolio had annualized returns of approximately 11% and 5%, respectively, in the corresponding periods. The above results already include modeled transaction execution costs and financing costs and do not represent actual returns received by investors. The analysis shows that, before deducting applicable strategy costs, the gross funding fee premium was approximately 11%—14%. The simulation assumes transaction execution costs of 20 basis points per rebalance and approximately 40 basis points for a full round trip, and assumes an annualized financing cost of 6% for leveraged positions. Under the model assumptions, each 10-basis-point reduction in transaction execution costs could improve the strategy's annualized return by about 1 percentage point, and each 1-percentage-point reduction in financing costs could bring about a further improvement of approximately 1 percentage point.

In addition, there is the impact of capital dilution. Specifically, when slippage increases, the strategy cannot fully deploy 100% of capital, and some capital remains idle. For this reason, and due to the need for a margin buffer, the strategy holds approximately 25% of capital in cash at any given time. This portion may earn a risk-free rate and add approximately +1% to overall returns.

This simulation assumes a loan-to-value (LTV) ratio of 50% for borrowing against rToken collateral, with tokenized equity positions eligible for up to 2x leverage. The corresponding Hyperliquid perpetual futures positions are modeled at 8x to 20x leverage, depending on margin buffer requirements determined by stressed market scenarios. Under these assumptions, the average notional rToken exposure is approximately 1.5 times the capital allocated to the basis strategy. For example, a $100 million capital allocation corresponds to average rToken exposure of approximately $150 million. These leverage assumptions increase the strategy's sensitivity to margin requirements, liquidity constraints, and adverse market movements.

Composable indices to help you build your own strategies

Keyring has created multiple modular basis pair index components based on Reality's rToken. Each component can be used independently, enabling managers to build systematic strategies with differentiated risk, return, and allocation objectives.

Trading the index. A common approach is for managers to use a 'risk overlay' mechanism to adjust their exposure to the equity basis index as market conditions change. For example, momentum indicators such as Bollinger Bands can help identify changes in funding rate trends and inform allocation decisions. These methods are for illustrative purposes only and do not guarantee improved performance.

Trading basis pairs. Managers can also build strategies around individual rToken basis pairs and trade these pairs to try to outperform the index. Statistical arbitrage techniques can use principal component analysis (PCA), which assumes that basis pair movements exhibit a typical structure, known as a covariance relationship. If the covariance matrix contains several key directional drivers, we can calculate the principal components (mathematically referred to as eigenvectors) and trade the noise fluctuations around these principal directions. This is a common strategy type known as statistical arbitrage, often run by hedge funds, but be mindful of transaction costs!

These trades are suitable for professional investors, and executing them on-chain requires a clear view of rToken positions across protocols, perpetual futures hedges, and collateral status. Tools such as 1Token can help consolidate these positions into a unified portfolio view, allowing managers to monitor profit and loss and margin status throughout the trading process. The index and related lending markets are planned to be offered through Bitget Earn.

About Bitget

Bitgetis the world's largestUniversal Exchange (UEX), serving over 125 million users, with more than 2 million crypto tokens listed, and supporting trading in over 500 tokenized stocks, ETFs, commodities, foreign exchange, and precious metals (such as gold). Its ecosystem is committed to helping users make trading smarter through AI agent-assisted execution. Bitget partners withMotoGP™and other strategic partners to promote cryptocurrency adoption. With a global impact strategy, Bitget works withUnited Nations Children's Fund (UNICEF)to provide blockchain education support to 1.1 million people by 2027. Bitget leads the tokenized TradFi market, providing the industry's lowest fees and highest liquidity across 150 regions worldwide.

For more information, visit:Official website｜X｜Telegram｜LinkedIn｜Discord

For media inquiries, contact: media@bitget.com

Risk warning: Digital asset prices are unstable and may experience sharp fluctuations. Investors are advised to invest only funds they can afford to lose. The value of any investment may fluctuate, financial objectives may not be achieved, and invested principal may not be recovered. Always seek independent financial advice and fully consider your personal financial situation and experience. Past performance is not a basis for evaluating future results. Bitget is not responsible for any potential losses. Nothing in this article constitutes financial advice. For details, seeTerms of Use。

About Reality

RealityReality is a compliant real-world asset (RWA) issuance platform for global markets, part of the Bitget ecosystem. We partner with licensed brokers on major exchanges such as Nasdaq and the New York Stock Exchange to acquire and custody the underlying assets, then issue corresponding rights on-chain. This connects traditional capital markets with on-chain infrastructure, enabling users worldwide to participate in real-world assets in an institutional-grade manner.

About Keyring

Keyring is the trust layer for on-chain markets.

• Keyring Connect verifies participant eligibility while protecting personal data.
• Keyring Structuring builds permissioned credit markets backed by tokenized assets and index strategies.
• Keyring Unwind enables investors to open and close leveraged positions in tokenized assets at scale, and coordinates redemptions and debt repayment through smart contracts.

Important Notice

Keyring.Network (Cayman) Limited (“Keyring”) operates as a permissioned access gateway to decentralized protocols and other decentralized finance (“DeFi”) applications. Keyring provides zero-knowledge verification services, enabling verified users to interact with smart contracts while preserving privacy.

Keyring is not:

• a financial intermediary, broker-dealer, or investment advisor;
• a custodian of user funds or digital assets;
• a counterparty to any transaction between users and DeFi protocols; or
• a guarantor of protocol performance or investment outcomes.

Interacting with DeFi protocols through Keyring involves significant risks, including smart contract exploits, market volatility, and the potential total loss of digital assets. Participants interact directly with the relevant protocols and bear full responsibility for all outcomes. Access may be restricted in jurisdictions where local laws or sanctions prohibit use. Global users must ensure compliance with all applicable laws and regulations in their respective jurisdictions. By using Keyring services, participants acknowledge the foregoing risks, voluntarily assume full responsibility for their actions, and agree that Keyring’s liability, if any, is limited to the maximum extent permitted by law.

About 1ndex by 1Token

1Token is a global technology service provider for digital asset investment managers, with operations across Asia-Pacific, Europe, and North America. The company provides technology support for over $20 billion in assets managed by more than 100 institutional clients and has obtained SOC 2 Type I and Type II certifications.

Its award-winning Crypto Asset Management (CAM) system connects to CeFi and DeFi trading venues via APIs, integrating portfolio management, trade execution, risk control, fund operations, and reporting functions in a unified environment. The platform supports front-office teams with real-time positions, exposure, and performance analytics; supports middle-office teams with portfolio operations, risk monitoring, shadow NAV, and investor activity management; and supports back-office teams with trade reconciliation, valuation, and profit and loss (P&L) reporting.

1ndex, 1Token’s research and data platform for tracking, analyzing, and evaluating digital asset investment strategies, effectively complements the above infrastructure.

1ndex:https://1ndex.1token.tech/

1Token:https://1token.tech/

About IPOR Fusion

IPOR Fusion, developed by IPOR Labs AG (headquartered in Zug, Switzerland), is on-chain vault infrastructure built for institutional-grade on-chain yield strategies. Its modular architecture provides deterministic risk controls, client-isolated vaults, embedded compliance mechanisms, and flexible configuration through composable modules called Fuses, while integrating with major on-chain protocols.

Source: 深潮 TechFlow