Komainu, a regulated digital asset institutional custody service provider, and Hidden Road, a global credit network for institutions, announced the addition of BlackRock USD Institutional Digital Liquidity Fund (BUIDL) as supported collateral under their triparty collateral management agreements.
Via tripartite agreements, Komainu clients, who are whitelisted eligible investors in BUIDL, will be able to trade via Hidden Road, using BUIDL as collateral, which will remain in custody with Komainu. This arrangement allows institutions to utilize their BUIDL holdings while maintaining the security of their assets within Komainu’s regulated and segregated custody. Komainu currently custodies assets for exchanges, financial institutions, asset managers, corporations, and government agencies.
Hidden Road was the first prime broker to join the Komainu Connect platform, enabling the use of digital assets in collateralization scenarios whilst assets remain in secure, regulated and segregated custody. Through this partnership, institutional clients can access prime brokerage services while reducing counterparty risk.
BUIDL is a fund sponsored by BlackRock and exclusively available through Securitize Markets. The fund is designed to offer institutional investors exposure to US dollar yields through tokenization.
Launched in April 2023, Komainu Connect reduces client counterparty risk by removing the need to store collateral with trading and liquidity counterparties, instead offering the ability to keep assets in safe custody whilst they are being utilized.
“We are continuously expanding our token support to meet institutional demand and to allow clients to earn passive yield on assets held in custody with Komainu,” said Paul Frost-Smith, co-CEO at Komainu, in a statement. “Yield-bearing short-term treasury funds, including BUIDL, are great collateral assets for Komainu Connect, our bank-grade collateral management offering.”
Michael Higgins, global head of Business Development at Hidden Road, said in a statement: “The addition of BUIDL as supported collateral in our triparty agreements with Komainu is a significant milestone in our mission to provide institutional investors with innovative and efficient access to markets across asset classes. By leveraging Komainu’s secure custody and Hidden Road’s multi-asset prime brokerage services, our clients can now utilize their BUIDL holdings to access credit and liquidity in digital asset markets.”
Carlos Domingo, co-founder and CEO at Securitize, said in a statement: “We’re developing an ecosystem that brings the advantages of tokenization to life. Real-world asset tokenization is scaling quickly, and we’re excited that Hidden Road and Komainu are adding BUIDL as supported collateral via their tripartite agreement to showcase the advantages of using tokenized short-term treasury funds for collateral.”