Canton Network adds four major market makers, including B2C2 and Cumberland, to the on-chain collateral management initiative, aiming to address inefficiencies in the cryptocurrency derivative market.
Canton Network, a highly interoperable blockchain infrastructure network, announces a strategic step in restructuring on-chain collateral management. Accordingly, four top market makers in the digital asset industry—including B2C2, Cumberland DRW, FalconX, and GSR—officially join this initiative.
These partners will collaborate with QCP and Flowdesk to build an encoded collateral management solution for the bilateral derivative market, expected to launch in the third quarter of this year.
The presence of these major names is not just about expanding scale but also strongly affirming Canton Network's vision. The initiative directly addresses an inherent problem in the cryptocurrency derivative market: inefficiency in capital management and utilization.
Currently, bilateral derivative transactions often require full or over-margin, causing significant capital freezing. Traditional collateral management solutions, such as third-party margin, are costly and complex.
Canton Network's solution applies smart contracts to automate the margin process, strictly adhering to legal standards like ISDA CSA for Initial Margin and Variation Margin. This technology helps automatically execute terms transparently, protecting the privacy of transaction participants—a key characteristic designed by Canton Network to ensure.
The platform will support continuous collateral management (24/7), reducing transaction cycle time, and expanding the use of advanced collateral assets like yield-generating stablecoins and encoded money market funds.
Mr. Cactus Raazi, B2C2's Americas Regional Director, notes: "The popularity of digital assets largely depends on building infrastructure with standards equivalent to traditional financial markets. Canton's on-chain collateral management solution is an important step, helping significantly improve capital utilization efficiency, automate processes, and enhance security."
Digital Asset's strategy—the company developing Canton Network—has an even broader vision. The company is collaborating with Euroclear, the operator of the $2 trillion Collateral Highway service, to explore applying traditional securities as collateral on cryptocurrency trading platforms. This move clearly demonstrates the ambition to deeply connect traditional finance (TradFi) and digital assets.
Cumberland DRW's participation is also particularly significant, as DRW's parent company is the founder of Digital Asset, which recently completed a $135 million funding round last month, consolidating resources to deploy ambitious goals.
