SemiLiquid, a custody-native infrastructure layer for institutional credit, announced the launch of its Programmable Credit Protocol (PCP). The infrastructure now enables various institutions to “activate credit against digital and tokenized assets held in custody – without transferring collateral, marking a critical advancement in the evolution of digital capital markets.”
Developed and launched in Abu Dhabi, the protocol is now planned to be rolled out globally, underscoring the UAE’s rise as a so-called “hub for digital assets and a launchpad for financial innovation.”
The launch is backed by a pilot conducted “with Franklin Templeton, Zodia Custody, Avalanche, Presto Labs, M11 Credit, Oasis Foundation & CMS.”
As part of the latest pilot, Franklin Templeton’s daily-yielding tokenized money-market fund, BENJI, was used “as collateral, which remained encumbered throughout the loan lifecycle, under pre-agreed terms and automated triggers.”
This simulated proof-of-concept allowed institutions “to retain full daily yield while granting lenders enforceable security over the assets – eliminating counterparty risk without any collateral movement.”
Rico van der Veen, Co-Founder and CEO of SemiLiquid has pointed out that programmable assets “require programmable credit.”
They added that PCP delivers the “missing rail that institutions need – a standardized, custody-native & shared legal framework that merges the trust of traditional finance with the efficiency of programmable assets.”
This marks a shift from incremental upgrades “to foundational infrastructure for institutional credit.”
Abu Dhabi Global Market’s environment has “enabled them to develop their solution within a risk-aware framework optimized for digital asset innovation.”
While tokenised assets are projected to reach “$10 trillion by 2030, credit infrastructure has remained trapped in legacy workflows.”
Over 70% of institutional bilateral financing still reportedly involves deal-by-deal paperwork & collateral transfers “across fragmented accounts and systems, creating counterparty risk and friction that prevent tokenized assets from functioning as scalable, financeable collateral.”
SemiLiquid’s pilot has shown that the technology and legal framework “is mature and institutions are ready.”
The firm is advancing to Phase II, launching in early next year, which will expand integrations across “additional custodians, collateral types, and jurisdictions.”
Future capabilities will reportedly include under-collateralized lending “supported by verified solvency attestations & and a unified framework for enforceability across markets.”