In a Nutshell
Standard Chartered and OKX introduce a program allowing institutional traders to use cryptocurrencies and tokenized money market funds as collateral off-exchange. The initiative, under Dubai’s regulatory framework, enhances security and efficiency for clients. Franklin Templeton is the first to offer funds through the program, bridging traditional finance with digital assets.
Institutional traders can now leverage cryptocurrencies and tokenized money market funds as off-exchange collateral, thanks to a new program launched by Standard Chartered and OKX.
Boosting Institutional Investor Confidence
Standard Chartered and OKX have unveiled a “pioneering” collateral mirroring program, enabling institutional clients to utilize cryptocurrencies and tokenized money market funds as off-exchange collateral for trading. This initiative, operating under the Dubai Virtual Asset Regulatory Authority’s (VARA) regulatory framework, aims to enhance security and capital efficiency for institutional clients by leveraging Standard Chartered’s custody solutions.
According to a statement, the appointment of Standard Chartered as the independent and regulated custodian within the Dubai International Financial Centre (DIFC) addresses counterparty risk, a significant concern in the digital asset market. OKX, on the other hand, will manage collateral and facilitate transactions through its regulated Dubai entity.
Margaret Harwood-Jones, Global Head of Financing and Securities Services at Standard Chartered, emphasized the importance of secure custody solutions in the evolving digital asset landscape.
“Our collaboration with OKX to enable the use of cryptocurrencies and tokenized money market funds as collateral represents a significant step forward in providing institutional clients with the confidence and efficiency they need,” she stated.
Hong Fang, President of OKX, highlighted the partnership’s role in setting industry standards for institutional clients.
Franklin Templeton, a leader in tokenization and real-world assets (RWA), will be the first to offer its money market funds through the program. Roger Bayston, Franklin Templeton Head of Digital Assets, underscored the innovation behind using blockchain technology to provide efficient and secure asset management.
“By ensuring assets are minted on-chain, we enable true ownership, allowing them to move and settle at blockchain speed – eliminating the need for traditional infrastructure,” Bayston said.
Brevan Howard Digital, the digital asset division of Brevan Howard, is among the first institutions to adopt the program. Ryan Taylor, Group Head of Compliance at Brevan Howard and CAO of Brevan Howard Digital, hailed the initiative as a significant step in the institutionalization of the crypto industry. He added:
“As a significant investor in the digital assets space, we are thrilled to partner with industry leaders to further grow and evolve the crypto ecosystem globally.”
The launch of this program marks a significant advancement in bridging traditional finance with the digital asset ecosystem, providing institutional investors with enhanced security and efficiency.
Source: Bitcoin
