Hidden Road Moves into OTC Digital Assets
Posted by Colin Lambert. Last updated: October 15, 2022
Credit network Hidden Road has publicly launched its OTC prime brokerage service for digital assets. The firm will act as the central counterparty to bilaterally executed trades.
Hidden Road says the new service will further institutional adoption of digital assets by giving counterparties full ownership and control over their execution technology, liquidity and custodian choice for both fiat and digital assets.
In conjunction with its support for exchange-traded products, the new OTC service enables true spread optimisation for the buy side and brokerage communities, the company claims, as well as a quicker, wider distribution channel for institutional market makers.
The firm adds that employing a novel approach that nets positions across all liquidity providers and venues, the offering introduces new operational and capital efficiencies while reducing credit risk, settlement risk and operational risk. Additionally, by increasing access to liquidity and expanding distribution, Hidden Road’s digital asset prime brokerage eliminates the need to onboard and negotiate multiple bilateral relationships, it says.
“Listening to our institutional counterparts, there was clear demand for Hidden Road to launch the first real prime brokerage solution for OTC trading of digital assets,” says Michael Higgins, global head of business development for Hidden Road. “The market was in need of a truly conflict-free prime broker, one without a proprietary trading desk, OTC liquidity desk or market making operation. Hidden Road provides a credit network and a true prime brokerage solution for digital assets, encompassing margin netting, financing of trading and centralised market access to leading global OTC liquidity providers.”