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OSL Americas will also act as the https://www.xcritical.com/ regional hub for engagement with OSL’s growing list of SaaS partners. Access to the OSL platform’s industry leading institutional-grade digital asset exchange will follow in due course. Led by Head of Americas Fernando Martinez, the Americas unit facilitates OSL’s market-leading prime brokerage offering, including electronic and OTC execution and coin borrowing and lending, into OSL’s deep pools of digital asset liquidity. OSL Americas will also act as the regional hub for engagement with OSL’s growing list of SaaS partners. Access to the OSL platform’s industry leading institutional-grade digital asset exchange will follow in due course.
- With customer expectations higher than ever, businesses are finding new ways to meet those demands.
- To conduct virtual currency business activity in New York State, entities can either apply for a BitLicense or for a charter under the New York Banking Law (for example, as a New York State limited purpose trust company or New York State bank) with approval to conduct virtual currency business.
- Each company holding a BitLicense that wishes to manage its license on NMLS must create a company record in the system (see above).
- The greater your access to liquidity, the better your ability to get the best possible price for your trades.
- We focus on delivering unsurpassed personal service to our customers while meeting the unique requirements of major institutions and high-net-worth individuals.
The importance of prime services for digital assets
Current New York State BitLicensees whose applications were submitted before the integration of the BitLicense into NMLS may cryptocurrency prime brokerage transition their licenses to NMLS. See the NY Virtual Currency Business Activity Company License Transition Checklist on the NMLS website for more information. To enter information into NMLS, you must first complete a Company Account Request Form and identify a Primary Account Administrator and a Secondary Account Administrator.
How DAMEX elevated their client facing operations with FM Liquidity Match
As an industry leader, we deliver an unmatched breadth of solutions to the digital asset and blockchain industry. We are an essential partner to investors, companies, founders, and creators in a changing financial world. BC Group and the OSL platform are enabling institutional adoption of the digital asset class, setting the global standard for performance, security and compliance. Institutional-level lines of credit give you the ability to trade assets through one venue, thereby minimising the risks of being spread thin across multiple exchanges.
Virtual Currency Business Activity (BitLicense)
Furthermore, the absence of detail in this guidance requires market participants to engage in their own interpretation of the scope of the CFTC’s stated general areas of focus. With Prizma, you are exposed to trading the underlying asset rather than artificially manipulated derivatives. We give you access to proprietary credit lines that give you the best positions in the market – beyond just leverage. Our systems manage risk at a professional fund management level, that can be adjusted to your appetite.
The Department of Financial Services uses the Nationwide Multistate Licensing System and Registry (NMLS) to manage the BitLicense. NMLS is a secure web-based system created by the Conference of State Bank Supervisors (CSBS), in cooperation with the American Association of Residential Mortgage Regulators to provide efficiencies in the processing of state licenses and improve supervision of state-regulated industries. Through NMLS, companies maintain a single record to apply for, amend, surrender and change license authorities in one or more states, and make reports conveniently and safely online. Both Advisories are remarkable for their brevity, considering the breadth of activity they encompass.
The Advisory also does not offer an opinion as to what digital assets constitute commodities or securities, or whether having CFTC-registered DCO clear digital asset derivatives gives the CFTC different or exclusive authority over those products. The news comes after OSL and Standard Chartered announced a partnership to launch a digital asset brokerage and exchange joint-venture with an initial focus on the European and UK markets. We’re driving the mechanisms of investment brokering and asset management that the world has grown accustomed to, into the future age of digital assets.
Another key development was the shift from a single prime model to a multi-prime model to reduce counterparty risk, contradicting one of the advantages of prime brokers to provide a one-stop shop. Clients realized that no prime broker was too big to fail and spread their risk across several prime brokers, especially providers with strong capital reserves. However, the multi-prime model led to an increase in operational complexity and cost, requiring additional investment from money managers in incremental risk management processes and technology and resources to reconcile activity at different prime brokers.
Thus, multi-prime has mainly been adopted by larger clients as it might be cost prohibitive for smaller money managers. Custody is the « foundation of the [prime services] pyramid. »xxi It is one of the key challenges that service providers had to solve to facilitate broader institutional involvement. While custody is important in a classic setting, safeguarding digital assets like bitcoin is paramount because, unlike traditional markets, there is no recourse if the assets are lost or stolen. Digital asset custody is also a highly technical undertaking and requires hardware, cybersecurity, and cryptographic expertise, that is not as relevant in the protection of traditional assets such as cash, stocks and bonds. Solving secure custody is necessary to effectively facilitating the following layers in the pyramid. Market participants engaged in credit substitution through the use of prime brokers, SEFs and SEF applicants, and DCOs (existing and applicants) engaging in clearing activities in digital assets or cryptocurrency markets should work with legal counsel to consider how to best ensure compliance in light of these Advisories.
The applicant’s NMLS Identification Number must be included on every hard-copy document submitted to the Department. Please also note that, in the process of considering an application, DFS may request additional information and supporting documents, beyond those found in the BitLicense Application Checklist. To submit an application, please follow the instructions on the NY Virtual Currency Business Activity License New Application Checklist (the “BitLicense Application Checklist”).
Since the beginning of the quarter, the company has supported regional regulated investment managers to launch single and multi-asset exchange traded products, including leading digital asset ETFs, by providing market leading operations, through competitive pricing, efficient settlements and its robust integrated platform. A digital asset prime broker can address these limitations by enabling netted collateral and providing consolidated settlement – the ability to fund a single account and connect to multiple high-quality liquidity providers and exchanges. This also reduces the burden of each client having to individually conduct due diligence on multiple trading venues. We give institutional investors the tools to execute investment strategies simply and safely. We’ll handle the integration, risk management, execution and reporting, so you get the most productive trading experience possible. To conduct virtual currency business activity in New York State, entities can either apply for a BitLicense or for a charter under the New York Banking Law (for example, as a New York State limited purpose trust company or New York State bank) with approval to conduct virtual currency business.
The episode also covers a range of fascinating topics, from the impact of the Bitcoin whitepaper on Jack’s vision to the evolution of the industry post-FTX. Fidelity Digital Asset Services, LLC, does not provide tax, legal, investment, or accounting advice. This material is not intended to provide, and should not be relied on for, tax, legal, investment or accounting advice. You should consult your own tax, legal, investment and accounting advisors before engaging in any transaction. In addition to considering the services prime brokers provide, money managers may evaluate and seek out certain characteristics in their prime brokers.
Each trade is conducted and executed directly with the customer and with no on-exchange price slippage or order book discovery. Institutional trading counterparties, making Galaxy one of the world’s leading liquidity providers in the digital asset space. OSL’s over-the-counter (OTC) and electronic RFQ/API offer access to unparalleled market liquidity with complete privacy, capital efficiency and guaranteed price quotes. Investors may choose to trade with a single or a few exchanges and OTC desks to avoid pre-funding on multiple platforms, reducing the operational and administrative complexity. On the flipside, setting up accounts with multiple exchanges and keeping them funded presents counterparty risk from those platforms not specifically built to safeguard assets.
Market participants will need to carefully evaluate their own practices, and seek guidance of legal counsel in that effort, to ensure their activities do not require DCO registration. Hidden Road Partners is the global credit network for institutional investors, enabling seamless access to traditional and digital markets. Conflict-free and built on a modern technology stack, we remove complexity and cost in prime brokerage, clearing and financing. Located and regulated in Malta, BEQUANT’s breadth of products include prime brokerage, custody and fund administration, all enhanced by an institutional trading platform providing low-latency trading, liquidity and direct market access for investors. « OSL’s combination of experienced traders, deep global relationships and advanced technology allow its prime brokerage to match large institutional blocks across major digital assets. » said OSL CEO Wayne Trench. « The appetite for digital assets across the Americas is rapidly growing and the timing of our launch coincides nicely to meet this demand. »
The Flow is Finery Markets’ branded podcast series, dedicated to exploring the exciting world of institutional crypto trading. Each episode explores the currents shaping the digital asset markets, offering listeners a unique blend of expert insights, industry trends, and forward-thinking strategies. Hosted by Finery Markets’ thought leaders and featuring a roster of distinguished guests from across the financial and technological landscapes, The Flow navigates through the complexities of electronic trading infrastructure, regulatory landscapes, and the evolving dynamics of liquidity and market making. It is unknown where digital asset prime brokerage will settle and how service providers will address challenges they face, as there is no full-service digital asset prime broker today. As the industry matures and participants expand, it will be important to track approaches to the following unanswered questions.