LONDON (Reuters) – The failure of credit default swaps to pay out to bondholders burnt by Greece should have spelt the beginning of the end for a bond insurance market accused of exacerbating Europe’s debt stresses.

That it may not underscores just how much investors have learnt to use the much-maligned derivatives for other purposes than purely guarding against default.

The euro zone crisis has also given impetus to the over-the-counter market and investors’ need to hedge their investments in bonds – like those of Germany – for which they previously thought such moves unnecessary.

It was easy to cast doubt on the value of CDS in insuring creditors against outright default after the latest proposal to restructure Greek debt with a 50 percent haircut failed to trigger payouts on contracts referencing the country.

Add to this an impending European Union ban on “naked” sovereign CDS trades aimed at investors who don’t have ownership of the underlying government debt, and it is little surprise that economists wondered whether the market would survive.

But while parts of the trade appear to be withering, certain segments are thriving.

Figures from New York-based Depositary Trust & Clearing Corp (DTCC) show active contracts currently worth $27.7 trillion (17.74 trillion pounds) versus around $26 trillion a year ago and the year before.