Standard Chartered is collaborating with the cryptocurrency exchange OKX to establish a collateral mirroring program designed for institutional clients. This initiative will allow clients to utilize cryptocurrencies and tokenized money market funds as off-exchange collateral for their trading activities.
The partners emphasize that this program enhances both security and capital efficiency for institutional clients by employing a Globally Systemically Important Bank (G-SIB) as the custodian for collateral assets. The collateral mirroring capability has been introduced as a pilot initiative within the regulatory framework of the Dubai Virtual Asset Regulatory Authority (VARA), providing clients with improved protection against counterparty risk, which is a significant concern in today’s digital asset markets.
In this collaboration, Standard Chartered serves as a regulated and independent custodian, ensuring the secure storage of collateralized assets. Meanwhile, OKX, through its VARA-regulated entity, manages the collateral and facilitates the associated transactions.
Margaret Harwood-Jones, Standard Chartered’s Global Head of Financing and Securities Services, stated, “We recognize the essential need for robust and secure custody solutions in the evolving digital asset landscape. Our partnership with OKX to enable the use of cryptocurrencies and tokenized money market funds as collateral is a major advancement in offering institutional clients the confidence and efficiency they require.” She added, “By leveraging our established custody infrastructure, we uphold the highest standards of security and regulatory compliance, contributing to increased trust in the digital asset ecosystem.”
Franklin Templeton will be the first of several money market funds to be featured in the OKX-Standard Chartered program. Additionally, Brevan Howard’s dedicated crypto and digital asset division is among the initial participants to onboard into this initiative.
Hong Fang, President of OKX, commented, “Our collaboration combines Standard Chartered’s global reputation as a leading custodian with OKX’s market position in cryptocurrency trading. This partnership sets a new industry standard, enabling institutional clients to deploy trading capital at scale within a trusted environment.”
Earlier this year, OKX’s operator Aux Cayes Fintech faced significant scrutiny, resulting in $504 million in fines and fees for violating U.S. anti-money laundering regulations.