Nasdaq and Talos announced a new partnership to create an integrated solution for tokenized collateral management by linking Talos’s digital asset infrastructure with Nasdaq’s Calypso and Trade Surveillance platforms.
The collaboration aims to overcome key structural obstacles that have limited the broader use of tokenized collateral in institutional markets, particularly the difficulty of incorporating digital assets into existing collateral and risk management systems.
“This partnership solves a fundamental challenge facing institutional markets: the inability to manage exposure across markets with a single risk and asset lens,” said Roland Chai, Executive Vice President, Nasdaq.
Solution to unlock trapped capital and improve operational efficiency
Tokenized collateral, the digital representation of traditional financial assets on distributed ledger technology, enables real-time mobility of securities, cash equivalents and other high-quality assets across platforms and jurisdictions.
This programmable approach presents a significant opportunity to unlock trapped capital and improve operational efficiency. A recent Nasdaq report found that 25 percent of collateral is currently tied up in corrective and non-interest-bearing measures, representing over $35 billion in excess or non-remunerated collateral.
However, capturing this opportunity requires infrastructure that enables institutions to manage tokenized collateral with the same operational rigor and integrated controls applied to mainstream asset classes.
“This partnership builds on a series of strategic initiatives designed to converge on- and off-chain market ecosystems, while preserving the liquidity, transparency and integrity of regulated markets. As both a market operator and technology provider to the global financial industry, Nasdaq is uniquely positioned to drive forward the next wave of innovation and growth across global capital markets,” added Chai.
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Move to expand institutional connectivity to marketplaces and custodians
In this context, Talos delivers institutional-grade digital asset capabilities spanning front-office portfolio construction, valuation and execution through to back-office operations, while Nasdaq Calypso is a leading platform used by global financial services firms to manage risk, margin and collateral requirements across mainstream asset classes.
Connecting the two platforms offers market participants a path to managing both on- and off-chain collateral workflows in an integrated environment. It also expands institutional connectivity to marketplaces and custodians across both market ecosystems.
“The evolution toward tokenized collateral is a natural progression for institutional capital markets. By combining Talos’s digital asset infrastructure with Nasdaq’s Calypso and Trade Surveillance platforms, firms can connect workflows for execution, risk, collateral and compliance to reduce operational friction across both on- and off-chain asset classes,” said Anton Katz, CEO and Co-Founder of Talos.
