Flowdesk, a cryptocurrency market maker, has become the latest participant in the Canton Network’s initiative to create an advanced on chain solution for collateral and margin management in bilateral crypto derivatives. Working alongside Digital Asset, QCP, and various trading counterparties, Flowdesk will contribute to building an innovative infrastructure that utilizes the Canton Network’s privacy features.
This collaboration aims to tackle persistent challenges in cryptocurrency derivatives trading, especially the high capital requirements for collateralization. Flowdesk’s involvement will strengthen efforts to develop an economical and regulatory compliant framework for managing margin using blockchain technology.
The Canton Global Collateral Network founded by Digital Asset has already attracted a few industry players. Apart from Singapore institutional trading venue QCP joining earlier this year, Circle announced plans to launch a native version of USDC stablecoin on the Canton Network. That follows its acquisition of tokenized money market (MMF) fund startup Hashnote, which had already launched its USYC MMF on Canton.
“Canton Network’s offering provides the ability to manage collateral and margin on chain, aligning with Flowdesk’s mission to create scalable and robust infrastructure for the digital asset economy,” said Simon Nursey, Head of Derivatives at Flowdesk.
Key features of the platform will include ISDA CSA-compliant smart contract collateral agreements and automated processes for handling margin calls and resolving disputes.
Earlier this year Flowdesk finalized an $102 million equity financing round as well as debt from BlackRock managed funds.
Collateral mobility is widely considered a prime use case for distributed ledger technology and Digital Asset is tackling the challenge from different angles. For example, it recently collaborated with Euroclear for tokenized collateral to enable instant transfers of non cash assets to meet margin requirements.
