In a strategic move aimed at accelerating the institutional adoption of digital assets, cryptocurrency exchange OKX has entered into a groundbreaking partnership with custody provider Komainu and asset manager CoinShares.
This alliance paves the way for round-the-clock trading of segregated assets while ensuring robust security measures and mitigating counterparty risks.
OKX, Komainu, and CoinShares Partner to Transform Institutional Crypto Trading
According to a November 15 press release, the collaboration positions CoinShares to actively trade on the OKX exchange with Komainu, a trusted third-party custody provider, overseeing the secure storage of collateral assets.
This arrangement enhances the appeal of digital assets for institutional traders and brings unprecedented transparency and clarity to the rights, responsibilities, and redress mechanisms within the ecosystem.
Lennix Lai, Global Chief Commercial Officer at OKX, believes that innovative solutions like this will catalyze the next wave of institutional capital flowing into the crypto markets.
He remarked, “We’ve listened to our institutional customers and worked with Komainu and CoinShares, who are leaders in their respective sectors, to find a mutually beneficial solution that mitigates counterparty risk while maximizing upside for traders.”
One of institutional investors’ most significant challenges when entering the crypto markets is counterparty risk. Lewis Fellas, Head of Hedge Fund Solutions at CoinShares, emphasized the importance of addressing this concern, stating,
“Without fail, it’s the topic most discussed in investor meetings and a major challenge to be overcome as we prepare for true institutional participation in crypto markets.”
The partnership between OKX, Komainu, and CoinShares aims to tackle this challenge by implementing a robust legal structure and processes that mitigate counterparty risk while facilitating high-volume trading.
OKX’s Partnership with Komainu
The partnership between OKX, Komainu, and CoinShares builds upon OKX’s previous collaboration with Komainu in June 2023, when they joined the Komainu Connect platform.
Founded in April 2023, Komainu Connect aims to minimize client counterparty risk by eliminating the necessity of storing collateral with trading counterparts, providing the option to keep assets in custody securely. This earlier partnership laid the foundation for the tripartite agreement.
Nicolas Bertrand, CEO at Komainu, expressed his satisfaction with the collaboration, describing it as a significant step forward in their mission to provide digital asset custody solutions.
He stated, “We are very pleased to contribute our expertise in institutional-grade custody services to this tripartite agreement, which advances our vision of achieving more trusted crypto markets in collaboration with OKX and CoinShares.”