Standard Chartered has partnered with cryptocurrency exchange OKX to introduce an innovative collateral mirroring program, allowing institutional clients to leverage cryptocurrencies and tokenized money market funds as off-exchange collateral for trading. This collaboration aims to enhance security, capital efficiency, and regulatory compliance in digital asset markets.
Key Features of the Program
- Secure Custodianship:
Standard Chartered serves as the regulated custodian, ensuring safe storage of collateral assets under Dubai’s Virtual Asset Regulatory Authority (VARA) framework. - Risk Mitigation:
Clients gain counterparty risk protection, addressing a major concern in crypto markets. - Capital Efficiency:
Institutions optimize trading capital by using tokenized assets like Franklin Templeton’s money market funds.
👉 Explore how OKX enhances institutional crypto trading
Industry Impact
Margaret Harwood-Jones, Global Head of Financing and Securities Services at Standard Chartered, emphasized:
"Our custody infrastructure ensures top-tier security and compliance, fostering trust in digital assets. This program empowers institutions to trade with confidence."
Hong Fang, President of OKX, added:
"Combining Standard Chartered’s custodial expertise with OKX’s trading leadership creates a benchmark for institutional crypto adoption."
First Participants
- Franklin Templeton: Initial provider of tokenized money market funds.
- Brevan Howard’s Digital Asset Division: Among the first institutional adopters.
Regulatory Context
The program debuts as a pilot under VARA, aligning with global standards. Notably, OKX’s operator faced $504M in fines earlier this year for AML violations, underscoring the need for stringent compliance.
FAQs
Q: How does collateral mirroring work?
A: Clients pledge crypto/tokenized assets to Standard Chartered, which mirrors their value for trading on OKX—without transferring ownership.
Q: What assets are accepted?
A: Cryptocurrencies and tokenized money market funds (e.g., Franklin Templeton’s offerings).
Q: Is this available globally?
A: Currently piloted in Dubai under VARA, with potential expansion.
👉 Learn more about institutional crypto solutions
Conclusion
This partnership bridges traditional finance and digital assets, offering institutions a secure, efficient way to trade. By prioritizing custodial trust and regulatory adherence, Standard Chartered and OKX set a new precedent for institutional crypto engagement.
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