Clearing houses, also known as central clearing counterparties (CCP), have been seen as the answer by policymakers. However, Robert Sams, the CEO of Clearmatics, believes the distributed ledger could be a real solution for the industry. “The CCPs are now the largest counterpart to most of the players in the derivatives market and are ‘too big to fail’,” Sams told CNBC via email. “Collateralization and resolution procedures are supposed to mitigate the risk of an event leading to public rescue, but these assumption-laden procedures are fragile and might be blown to bits upon first contact with market reality in times of stress. We should be decentralizing counterparty risk, not centralizing it.” Sams, and his London-based firm Clearmatics, have been tasked with innovating with derivatives trading with a form of the public ledger similar to bitcoin’s. UBS is one big bank that has already shown an interest and reports state that many more are keeping a keen eye on the project.
How Wall Street is embracing bitcoin
More of Today's Solutions
Colombia sets precedent to protect uncontacted Indigenous communities and bio...
BY THE OPTIMIST DAILY EDITORIAL TEAM In a landmark decision, Colombia created its first officially recognized territory dedicated to safeguarding Indigenous peoples living in ...
Read MoreEffective stress management: trade in the ‘fight or flight’ response for ‘ten...
BY THE OPTIMIST DAILY EDITORIAL TEAM When we experience stress, most of us are familiar with the fight-or-flight response. Our bodies prepare to face ...
Read More3 ways to get the most benefits out of your daily walk
During the pandemic, walking has become many people's new workout? With fitness facilities closed, people got a little more creative with how to stay ...
Read MoreNew York Governor protects transgender youth’s right to transition-related care
New York Governor Kathy Hochul took an important step toward preserving the rights of transgender adolescents on Sunday, June 25th, by signing legislation to ...
Read More
