Anchorage Digital unveils new platform designed to mitigate counterparty risks in cryptocurrency trading
Financial institution introduces CMS technology enabling crypto trading venues to serve institutions while maintaining assets under regulated custody, minimizing reliance on pre-funded trading accounts.
A new settlement platform from Anchorage Digital has been unveiled, enabling institutional investors to execute trades on cryptocurrency venues while maintaining their assets under custody at the company's federally regulated banking entity, a move designed to address counterparty and operational risk concerns.
The company's Monday announcement detailed how Coordinated Multiparty Settlement (CMS) functions as a bridge connecting trading platforms, prime brokerage services and institutional participants via a unified settlement infrastructure, ensuring assets remain at Anchorage Digital Bank during the entire trading process.
The CMS platform performs verification of funding requirements and orchestrates settlement procedures among all participating parties, minimizing the quantity of asset movements required to execute and complete transactions. According to Anchorage, the technology aims to diminish dependence on pre-funded accounts at exchanges, which represents standard operating procedure within cryptocurrency markets.
Through a Monday post on X, Anchorage highlighted that a significant portion of cryptocurrency trading activity continues to occur on offshore exchanges where "a single platform acts as exchange, custodian, and settlement agent" with customer assets frequently pooled together and registered under the exchange's name.
The CMS framework allocates distinct roles: prime brokerage firms oversee client account balances and credit arrangements, trading platforms function as order matching systems, while Anchorage delivers custodial and settlement capabilities.
Initial deployment of the platform will commence with Spotex, a foreign exchange trading service that Anchorage noted handles daily transaction volumes reaching into the billions of dollars, while integration work with additional trading venues is currently in progress.
Institutional trading infrastructure continues to evolve
The development of infrastructure supporting tokenized assets and institutional-grade trading is accelerating among financial institutions and digital asset firms, with the Canton Network serving as a central hub for these initiatives as organizations evaluate blockchain-powered settlement solutions.
Last December, DTCC formed a partnership with Digital Asset and the Canton Network to facilitate the tokenization of US Treasury securities held in DTC custody, with the program scheduled to extend to other asset categories. Two months following that announcement, Fireblocks completed its integration with the network, providing banks, custodial institutions and asset management firms the capability to custody and settle assets using a blockchain infrastructure designed specifically for regulated financial markets.
Banking institutions are similarly committing resources to digital asset custody capabilities and market infrastructure development. This past May, Standard Chartered announced its agreement to purchase Zodia Custody alongside the spinoff of Zodia Solutions, an independent platform dedicated to serving institutional participants in digital assets. This deal brings together the bank's custody functions while establishing a distinct entity concentrated on delivering services to financial institutions.