Clients of the crypto custodian are now permitted to utilize money market fund tokens as collateral in derivatives transactions following the company’s sanction by the Financial Services Regulatory Authority (FSRA) in Abu Dhabi.
Copper, a cryptocurrency firm, announced in a press release on Wednesday that it is now capable of providing clients with secure custody and trading services for tokenized money market funds, including Blackrock’s BUIDL.
The crypto custodian has received regulatory approvals from the Financial Services Regulatory Authority (FSRA) in Abu Dhabi, which allows Copper clients to utilize tokenized money market funds as collateral in derivatives trades, according to the London-based company.
Securitize, Franklin Templeton, Ondo, and Hashnote are among the main participants in tokenization with which the company has formed new partnerships. Securitize serves as the transfer agent and tokenization vehicle for Blackrock’s USD Institutional Digital Liquidity Fund, which is represented by the blockchain-based BUIDL token and issued on the Ethereum blockchain.
Tokenized Treasuries are leading the way in the digital representation of real-world assets on blockchains, enabling them to be traded as tokens on networks such as Ethereum, Stellar, Solana, and Mantle. These tokens are digital representations of U.S. government bonds. In order to achieve operational efficiencies and expedited settlements, digital asset firms and TradFi giants have been competing to introduce financial instruments, including government bonds, private credit, and money market funds, onto blockchain rails.
Amar Kuchinad, Copper’s global CEO, stated in emailed comments that tokenized money market funds could potentially increase returns for derivative market participants if the Federal Reserve maintains higher rates for an extended period. These participants would receive income from the collateral they post to counterparties.
