The NASDAQ has recently been developed in collaboration with a blockchain-acquired margin and collateral management solutions- QCP, Primroz Capital Management, and Digital Asset Holdings-OTC Crypto indicates a significant moment in market institutionalization. We sat down with QCP CEO Melvin Deng, to find out what it means for the broader digital asset ecosystem, and how this innovation can reopen the capital markets.
What inspired QCP to participate with Nasdaq on this initiative?
Our inspiration was simple: building the future of the infrastructure of the financial market with a world class leader. For extensive institutional adoptions for digital assets, they need to be supported by the same institutional-grade, reliable technology that strengthens traditional markets. As an early investor in Canton Network and as contributor to its infrastructure and product testing, QCP saw a unique opportunity to co-develop important rail to adopt institutional crypto. NASDAQ is a global technology company that specializes unmatched in the manufacture of flexible and scalable capital market solutions. This partnership allows us to integrate co-development and a solution that bridges the gap between traditional and digital finance, which is the main for the QCP’s mission to make digital assets an indispensable part of every institutional portfolio.
How does this blockchain-based solution improve the workflows for OTC Crypto derivatives?
It funds fundamentally slow, manual processes completely automated, real -time environment and replaces them. Previously, margin calls and collateral movements were often managed, which led to delay and operational risk. Nasdaq’s Calypso platform and constructed on Canton Network, solutions strengthen end-to-end operations from margin calls and collateral pledge to dispute solution. By taking advantage of a shared account book on the Canton network, all parties have a single source of truth for pricing data, which eliminates disputes and disposal intervals. Most importantly, it supports 24/7 margining regime, which is always essential for the crypto markets.
What are the biggest challenges to solve this technique institutionally?
The two biggest challenges of this solution are the opposition credit risk and disable capital allocation. Over the years, the institutes are hesitant to connect deep into the OTC Crypto markets due to the difficulty of managing the opposition risk in real time. This technique directly addresses that by providing an automatic, 24/7 margin and collateral rule. This, in turn, solves the second problem of “stuck capital”. By improving the speed and flexibility of collateral dynamics, the firms no longer need the useless capital sitting in a slow disposal processes. And because it operates on a synchronized laser with real-time visibility, it allows for a spontaneous difference between heritage finance and on-chain environment. This unlocks the important pool of inventory and allows capital to be deployed more efficiently.
How do you adopt tokens traditional assets and affect stabechoin as collateral?
It is an important catalyst for their adoption. A major obstacle to using tokens and stablecoins of tokens as institutional collateral has been a reliable, automatic infrastructure deficiency to manage them. To accept token bonds for a bank or Prime broker, for example, they require a system that can give it importance in real time and execute the margin call immediately, 24/7. This integrated capacity provides this right. The solution is clearly designed to support the integration of stabelines and tokens of real-world assets as real collateral, effectively makes them “plug-and-play” for institutional risk management systems. It is already being kept in practice with integration on Canton, as well as tokens of collateral flow supported by QCP.
What role does trust and network verification play in this new infrastructure?
The trust is the absolute foundation. Increasing confidence in the infrastructure that reduces digital asset ecosystems is important for its long -term development. This is why it is so important that the Nasdaq will serve as a verification on the Canton network. Being a global recognized market operator such as the Nasdaq valid transactions gives the network a unique level of integrity and assurance. It indicates institutions that the network is not only technically innovative, but also operated and safe for the highest possible standards.
How does this digital asset fit into the broad roadmap of QCP for innovation?
This partnership is a main component of our roadmap; This is the founder Rail, on which we will produce our next generation products. QCP is building obedient infrastructure for actively derivatives and structured products for institutions, as a major digital asset partner in Asia and a strategic backer of Canton. Our vision is to make digital assets a founding part of the institutional balance sheet, and it requires market infrastructure that is both innovative and reliable. As we announced in release, taking advantage of this groundbreaking capacity, we will develop a new suit of OTC spots and derivative products. This advanced infrastructure allows us to create more sophisticated solutions for our customers and accelerate our mission to bridge traditional and digital finance.
What results do you expect for the ecosystem over the next 12-18 months?
In the next 12 to 18 months, we hope to look at the direct results of this innovation in three major ways. First, more and more institutional participation in OTC space, as this technique reduces the opposition risk. Second, the capital unlock capital that was previously trapped in the form of increase in market liquidity and capital efficiency, 24/7 margining and quick disposal. Finally, you will see a new wave of product innovation. For firms like ours, this means that we can bring more complex, structured products to the market that was very difficult to manage from a collateral point of view earlier. In short, the market will be safe, darker and more mature. It is no longer theoretical now, with over 400 institutions on Canton and more than $ 4 trillion in the property flow of tokens. The infrastructure is live and scaling.
It is revealed how NASDAQ financial technology strengthens more than 3,800 major finance organizations
We are committed to helping market operators and participants to overcome infrastructure, operations and regulatory challenges. Our solutions empower you to focus on your main skills, focus on market growth and progress.
learn more
