Institutional Investment in ClearToken Demonstrates Importance of Clearing Infrastructure to Digital Asset Markets

ClearToken, a clearing house for the digital asset market, has received over $10 million in investment from institutional participants, underlining the importance of regulated clearing infrastructure to drive the next stage of growth in the market.

The support for ClearToken’s mission thus far has come from firms including Laser Digital, the digital asset subsidiary of Nomura, several global liquidity providers including Flow Traders and GSR, and leading digital asset firms LMAX Digital and Zodia Custody. Clearing infrastructure is a critical enabler to the institutional adoption of digital assets, including tokenized and crypto assets. Strong institutional support for ClearToken demonstrates the demand for traditional financial market infrastructure in digital asset markets to increase adoption, enhance fair and orderly markets, reduce systemic risks, and protect investors. There is a desire by institutional investors to increase allocations to
cryptoassets but the lack of segregated and regulated market infrastructure has held back their participation.

The benefits and market efficiencies achieved through centralised clearing in traditional markets do not need to be forgone by institutions to participate in digital asset systems underpinned by decentralised protocols. By enhancing market structure, ClearToken will support further institutional adoption, helping the digital assets market, currently capitalised at $2.6 trillion, to realise its full potential.

ClearToken will offer the benefits of horizontal clearing and settlement for digital assets and is committed to advocating for the implementation of a comprehensive supervisory framework for digital assets as set out in its recent White Paper – Creating Financial Market Infrastructure for Digital Assets: Securing Tokenised and Cryptoasset Trading.

ClearToken intends to be fully regulated in the UK and has initiated the process of obtaining clearing house recognition from the Bank of England, with the intention of launching CCP (Central Counterparty) services in 12-18 months. During 2024, ClearToken intends to launch preliminary settlement services, subject to the receipt of required approvals from the Financial Conduct Authority and Bank of England.