Real-time exposure management with Ivno and CloudMargin

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The OTC Space followed up on an announcement by Ivno and CloudMargin that they now have a partnership which enables CloudMargin customers to achieve real-time exposure management (should they choose to) by moving assets using the Ivno platform.  When I was a youngster in collateral management it was very much a once-per-day process much like the daily margin calls from a CCP. Some CCPs now monitor exposure intraday and can call for more assets if exposures demand it. The ability to move assets immediately would suggest that firms outside of clearing could choose to produce intraday exposure measures and collateralise those immediately. Whether the markets are volatile enough to require this is another matter. 

The announcement from CloudMargin and Ivno opens up the possibility of moving assets at any time of day by representing collateral assets as tokens on the Ivno network. This intrigued me enough to want to understand how the components of this chain work, including any underlying depository. In the video Aaron and Simon explain how the two systems work together to bring a new aspect to the nature of settlement to cover exposures.  The video is segmented below so you can dip into sections of interest.

We found out more about how the partnership will work including:

  • [03:04] What are the goals for the Ivno platform?
  • [04:01] How does the tokenisation process work?
  • [05:44] How is a custodian involved in this process?
  • [06:50] What does it mean to 'immobilise' an asset?
  • [07:41] How does CloudMargin work with Ivno?
  • [08:41] How are tokens reconciled back to a custodian?
  • [10:48] Could this enable 24x7 collateral management?
  • [11:32] When might we see this new partnership live in production?
  • [13:27] Will UMR drive the take-up of tokenisation?
  • [14:00] What sorts of assets can be tokenised?

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More information:

Real-time exposure management

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