Anchorage Digital has introduced a new settlement platform designed to enable institutions to trade on cryptocurrency venues while maintaining asset custody at its federally regulated bank. According to Cointelegraph, this initiative aims to mitigate counterparty and operational risks associated with crypto trading.
The platform, named Coordinated Multiparty Settlement (CMS), connects trading venues, prime brokers, and institutional clients through a unified settlement layer, ensuring that assets remain at Anchorage Digital Bank throughout the trade lifecycle. Anchorage Digital stated that CMS verifies funding obligations and coordinates settlements among participants, thereby minimizing the number of asset transfers required to complete trades. This system is intended to reduce the reliance on pre-funded exchange accounts, a prevalent practice in the crypto market.
In a recent post on X, Anchorage Digital highlighted that a significant portion of crypto trading still occurs on offshore platforms where a single entity often acts as the exchange, custodian, and settlement agent, leading to the commingling of client assets. Under the CMS model, prime brokers manage client balances and credit relationships, trading venues serve as matching engines, and Anchorage provides custody and settlement services.
The initial rollout of CMS will commence with Spotex, a foreign exchange trading platform that processes billions of dollars in daily volume. Anchorage Digital has indicated that additional venue integrations are currently in development.
The infrastructure for institutional trading and tokenized assets is rapidly evolving, with financial institutions and digital asset companies expanding their capabilities. The Canton Network has emerged as a key player in these efforts, as firms explore blockchain-based settlement solutions. In December, DTCC partnered with Digital Asset and the Canton Network to support the tokenization of DTC-custodied US Treasury securities, with plans to extend the initiative to other asset classes. Two months later, Fireblocks integrated the network, allowing banks, custodians, and asset managers to custody and settle assets on a blockchain tailored for regulated financial markets.
Banks are also investing in digital asset custody and market infrastructure. In May, Standard Chartered announced its acquisition of Zodia Custody while spinning off Zodia Solutions, a standalone platform dedicated to serving institutional digital asset clients. This transaction consolidates the bank's custody operations while establishing a separate entity focused on providing services to financial institutions.
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