Amid the growing popularity of digital assets in the institutional space, Cobalt announced this Wednesday that it has expanded its platform, which provides post-trade infrastructure for foreign exchange (forex), into the digital asset market.
According to the statement from Cobalt today, interest in digital assets has been accelerated by the decision from US banking regulator, the OCC, to allow banks in the country to hold digital assets. However, there is minimal enterprise standard post-trade infrastructure, Cobalt said.
This is the need Cobalt aims to fill. The company is currently connecting to digital exchanges on behalf of its clients and offers full credit and ledger services for all currencies and digital assets.
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The purpose of Cobalt is to redesign post-trade forex infrastructure and processes. To do this, the system’s automated technology matches all versions of a trade into one ‘trusted copy.’
By creating a trusted copy, the infrastructure generates one unchangeable data set of FX transactions. This is at odds with the current industry practice, where a single trade today creates multiple records for all parties. This leaves more room for error and inconsistencies throughout lifecycle events.
Commenting on the changes, Adrian Patten, Chairman and Co-founder of Cobalt, said in the statement: “The rise of digital assets has gone from strength to strength in the past years and has moved from being an asset traded on the periphery, to being at the forefront of FX participant plans.
“Participants today can no longer ignore the position of digital assets in the market and those who do are in danger of missing out on sizeable trading opportunities due to the 24/7 nature of the market. Major exchanges have started to translate this to the FX market, with some offering trading over the weekends. 24/7 operability has always been a priority to Cobalt. As digital assets continue their rise and influence over the FX market, participants are going to need to adapt to new ways of doing business.”