Following an undisclosed funding into Hqlax from Dutch multinational financial institution ING on March 6, Cointelegraph spoke to Nick Short, the COO of tokenized securities agency.
Short describes ING as one of many firm’s “longest-standing strategic partners,” emphasizing that the 2 corporations have collaborated in creating and testing Hqlax’s tokenized securities platform for over two years.
The two firms first partnered in 2019, with Hqlax launching an initiative to “develop DLT-driven solutions for more efficient and cost-effective liquidity management and collateral management in the global securities financing markets” alongside enterprise blockchain agency R3 and 5 banks together with ING.
ING conducts first dwell transaction on Hqlax platform
In early 2019, ING and Credit Suisse executed a dwell transaction on the Hqlax platform – swapping securities baskets valued at almost $28 million utilizing the appliance.
The Hqlax platform went dwell throughout December 2019, with ING’s blockchain staff creating the preliminary model of the appliance.
The platform permits traders to redistribute collateral by exchanging possession of tokenized securities on Corda’s blockchain with out requiring the motion of the underlying property.
Nick Short describes the platform as “facilitating more efficient collateral management of both high-quality liquid assets (HQLA) and non-HQLA via [a] four-layer operating model,” explaining:
“The digital collateral registry layer enables delivery-versus-delivery (DvD) ownership transfers of baskets of securities via digital collateral records (DCRs). This eliminates the current, operationally onerous, requirement to move securities from one custody location to another. We make this possible via integration with the leading Eurex Repo F7-trading system where Hqlax platform transactions are executed, and a Deutsche Börse-owned Trusted Third Party (TTP) entity, which connects the custodians/tri-party agents to the digital collateral registry.”
Short indicated that Hqlax plans to completely goal institutional shoppers, stating that they don’t have any present plans for the retail market, including that, “We remain focused on the many opportunities that we see to enable frictionless ownership transfers of assets for institutions.”
Hqlax to onboard extra banks throughout 2020
Looking to the remainder of 2020, Short states that Hqlax is at present onboarding Commerzbank, Credit Suisse, UBS, and several other different monetary establishments onto the platform.
The firm additionally plans so as to add extra custody places beginning with J.P. Morgan, which Short states “is in the process of becoming the third tri-party agent in the Hqlax operating model, alongside Clearstream Banking S.A. and Euroclear Bank.”
Short additionally mentioned that Hqlax will look to develop its merchandise to handle particular “pain points” within the securities lending markets, together with collateral improve and downgrade transactions, digital collateral re-use, and intraday buying and selling.