Crypto exchange OKX, custody provider Komainu and asset manager CoinShares have joined forces to offer 24/7 trading of segregated crypto assets to institutions, aiming to promote wider adoption of digital assets. Sebastian Widmann, Head of Strategy at Komainu, believes this collaboration is a crucial step for institutional adoption of digital assets.
Through her partnership With CoinShares, OKX enables trading on its exchange, while Komainu, as a third-party custody provider, protects collateral throughout trading. This agreement mitigates counterparty risk by minimizing the likelihood that either party will default on its obligations.
According to Sebastian Widmann, this type of trading closely resembles traditional financial market infrastructure and has the potential to attract more institutional investors to the crypto space. “By acting as independent, trusted and regulated custodians of collateral assets, we provide our customers with additional security throughout their trading lifecycle,” explained Widmann.
According to Lennix Lai, Chief Commercial Officer of OKX, this new solution removes one of the biggest hurdles for institutional crypto trading, counterparty risk. He explained:
“Secure custody solutions, regulatory frameworks and increasing exchange liquidity are in place for institutional crypto trading. But we still see counterparty risk as a challenge.”
Lai is confident that this solution can increase trust among institutional crypto traders, creating a more reliable landscape for digital asset transactions. In a previous interview, Lai emphasized that increasing compliance standards is crucial to attracting traditional financial investors to the crypto space.
For Lewis Fellas, head of hedge fund solutions at CoinShares, this partnership creates a “robust legal mechanism” for managing each other’s assets. Fellas further explained that this collaboration demonstrates the firm’s expertise in “negotiating complex tripartite agreements that cover collateral, security and legal risk” elements that are critical to institutional investors.
Also read: How Stride is changing liquid staking on Cosmos
Learn Crypto Trading, Yield Farms, Income strategies and more at CrytoAnswers
https://nov.link/cryptoanswers
Comments are closed.