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Banking giant Standard Chartered and global crypto exchange OKX have launched a pilot programme in Dubai that could reshape how institutional investors trade digital assets.
The new collateral mirroring programme allows institutions to use cryptocurrencies and tokenised money market funds as collateral for trading, without moving those assets onto an exchange. This reduces counterparty risk, a major concern in the crypto world, and enhances capital efficiency for large investors.
It’s the first such initiative to bring together a major global bank, a regulated crypto platform and a traditional asset manager to support secure crypto trading for institutions.
The pilot is being rolled out under the regulatory oversight of Dubai’s Virtual Asset Regulatory Authority (VARA), making it one of the most prominent real-world implementations of regulated digital finance in the region.
Hong Fang, president of OKX, summed it up:“As the digital assets ecosystem becomes more ingrained within traditional finance, we strive to both drive growth and safeguard client assets in the most capital efficient manner. By leveraging Standard Chartered’s position as a top custodian globally, as well as OKX’s market leadership in cryptocurrency trading, the partnership sets an industry standard for current and potential institutional clients to deploy trading capital at scale in a trusted environment.”
Using crypto as collateral
Under the programme, Standard Chartered acts as the regulated custodian. The bank holds the collateral securely in the Dubai International Financial Centre (DIFC), while OKX facilitates trading activity through its VARA-regulated entity.
Speaking about the launch, Margaret Harwood-Jones, global head of financing and securities services at Standard Chartered, said: “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.”
She added that the bank is “ensuring the highest standards of security and regulatory compliance, fostering greater trust in the digital asset ecosystem.”
Backed by Franklin Templeton, Brevan Howard Digital
One of the major components of the pilot is the inclusion of tokenised money market funds provided by Franklin Templeton, a traditional asset management giant with $1.58tn in assets under management.
Roger Bayston, head of digital assets at Franklin Templeton, said: “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.”
This effectively turns traditional, low-risk financial products such as money market funds into on-chain assets that can be integrated into digital finance workflows.
Also onboard is Brevan Howard Digital, the crypto arm of the global hedge fund. The firm is among the first institutional players to participate.
Ryan Taylor, group head of compliance at Brevan Howard and CAO of Brevan Howard Digital, said:
“This programme is the latest example of the continued innovation and institutionalisation of the industry. 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.”
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