Komainu and Hidden Road add BUIDL as collateral in triparty agreements
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Komainu and Hidden Road add BUIDL as collateral in triparty agreements 17 October 2024UK Reporter: Daniel Tison
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Komainu and Hidden Road have added BlackRock USD Institutional Liquidity Fund (BUIDL) as supported collateral under their triparty collateral management agreements.
Komainu clients, who are whitelisted eligible investors in BUIDL, will be able to trade via Hidden Road, using BUIDL as collateral, which will remain in custody with Komainu.
This arrangement allows institutions to utilise their BUIDL holdings while maintaining the security of their assets within Komainu's regulated and segregated custody.
Michael Higgins, global head of business development at Hidden Road, says: “By leveraging Komainu's secure custody and Hidden Road's multi-asset prime brokerage services, our clients can now utilise their BUIDL holdings to access credit and liquidity in digital asset markets.”
Through this partnership, institutional clients can access prime brokerage services while reducing counterparty risk, Komainu says.
“Yield-bearing short-term treasury funds, including BUIDL, are great collateral assets for Komainu Connect, our bank-grade collateral management offering,” says Paul Frost-Smith, co-CEO at Komainu. “We are delighted to be working with Hidden Road to support clients in maximising the capital efficiency of their custodied assets and increasing the efficiency of the digital asset markets more generally.”
Launched in April 2023, Komainu Connect reduces client counterparty risk by removing the need to store collateral with trading and liquidity counterparties, the firm says, and offering the ability to keep assets in safe custody while they are being utilised.
Komainu was established in 2018 to provide institutions with a range of secure and compliant custody, as well as related services to access the digital asset markets.
The firm currently custodies assets for exchanges, financial institutions, asset managers, corporations, and government agencies.
Sponsored by BlackRock and exclusively available through Securitize Markets, BUIDL is a fund designed to offer institutional investors exposure to US dollar yields through tokenisation.
Carlos Domingo, co-founder and CEO of Securitize, says: “We’re developing an ecosystem that brings the advantages of tokenisation to life. Real-world asset tokenisation is scaling quickly, and we’re excited that Hidden Road and Komainu are adding BUIDL as supported collateral via their tripartite agreement to showcase the advantages of using tokenised short-term treasury funds for collateral.”
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