Pre-trade settlement refers to the process of verifying and reserving funds or assets before a trade is executed on a platform. This mechanism ensures that participants possess the necessary holdings to complete a transaction, preventing settlement failures. It enhances market integrity and reduces counterparty risk.
Context
Pre-trade settlement is a critical feature in traditional finance and is gaining relevance in digital asset markets, particularly for institutional participants and regulated platforms. Its implementation addresses concerns about capital efficiency and risk management in high-volume trading environments. News often discusses its role in making digital asset trading more robust and appealing to mainstream financial entities.
DLT standardizes pre-trade workflows for alternative investments, accelerating time-to-trade and lowering operational friction across the wealth management value chain.
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