Triparty settlement involves three distinct parties—typically two trading counterparties and an independent third-party agent—facilitating the clearing and settlement of a financial transaction. This is particularly relevant for complex assets or those requiring specialized collateral management. In digital assets, this structure enhances security and operational efficiency by separating custody from trading.
Mechanism
The mechanism involves the third-party agent, often a custodian bank or a specialized digital asset trust, holding collateral on behalf of both trading parties. Upon trade execution, the agent ensures that assets are transferred from seller to buyer and payment from buyer to seller, or collateral adjusted, only when all pre-agreed conditions are met. This minimizes counterparty risk and automates the transfer of ownership.
Methodology
The methodology centers on leveraging an independent, trusted third party to provide real-time, atomic settlement capabilities, especially for over-the-counter (OTC) or block trades in digital assets. This framework provides greater security for both participants, as the assets are not held directly by either trading party during the settlement phase. It also ensures compliance with institutional custody and asset transfer requirements.
Bybit's new B2B unit strategically enhances market infrastructure, offering institutional clients advanced solutions for secure, efficient digital asset engagement.
This strategic move by a leading exchange establishes a robust framework for institutional engagement, optimizing capital efficiency and mitigating counterparty risk.
This strategic initiative by Bybit provides a robust framework for institutional engagement, offering advanced custody and settlement solutions to bridge traditional finance with the evolving digital asset ecosystem.
This strategic move by Bybit establishes a robust B2B framework, enhancing institutional access to digital assets with advanced risk mitigation and capital efficiency.
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