Institutional participation in crypto markets is key to their success and ability to scale. While many established institutions are already participating in this sector of finance, the growth will take some time.
This week, global bank Standard Chartered and crypto exchange OKX revealed a partnership designed to support institutional participation in crypto markets. The duo has created a “collateral mirroring program” to enable the leveraging of these assets for off-exchange collateral for trading.
We understand the critical importance of robust and secure custody solutions, especially in the evolving digital asset landscape, and our collaboration with OKX to enable the use of cryptocurrencies and tokenised money market funds as collateral represents a significant step forward in providing institutional clients with the confidence and efficiency they need,” said Margaret Harwood-Jones, Global Head of Financing and Securities Services at Standard Chartered, in a company statement.
The collateral mirroring is now a Pilot within the Dubai Virtual Asset Regulatory Authority’s (VARA) regulatory framework. Dubai is a jurisdiction that has been supportive of digital asset innovation.
Standard Chartered is acting as the custodian, regulated by Dubai Financial Services Authority.
Franklin Templeton, which has already announced tokenization projects, will be the first money market fund to be incorporated into the “OKX-SCB” project.
OKX clients will now gain access to assets developed by Franklin Templeton’s Digital Assets Team.
Hong Fang, President of OKX, notes that as digital assets become more ingrained within the traditional financial system, standards must be high to ensure safe and secure participation.