By James Pike, Chief Revenue Officer and Head of Strategy, Taskize.
Collateral teams have been tested in 2025. Banks have weathered multiple bouts of high volatility, including the fallout from ‘Liberation Day’ and sell-offs over fears of a possible AI bubble. Sharp spikes in volatility across multiple asset classes have the potential to disrupt collateral management as liquidity dries up. Thankfully, on the whole, these processes held up.
While pleasing, this doesn’t mean all is well with the way collateral is mobilised and exchanged. As we head into 2026, now is the time to optimise the process and make it more cohesive. This will enable banks to utilise collateral more effectively and also lay the groundwork to test new innovations, such tokenised collateral.
There are two core collateral management needs high on the agendas of collateral teams. First and most important is the optimisation across multiple collateral pools, including many different tri-party arrangements. Large banks typically maintain collateral across multiple tri-party agents, creating a complex ecosystem of assets with varying eligibility and cost profiles. The core challenge is not simply understanding where collateral sits, but actively managing and optimising these pools, ensuring obligations are met with the cheapest eligible collateral while maintaining sufficient availability across all commitments. It’s a juggling act that requires coordination across multiple parties.
There is also a need for accurate, up-to-date visibility of inventory across all pools. Knowing which assets are available, eligible, liquid, and where they are held – such as the custodian or tri-party longboxes – is key to becoming more nimble in how the collateral is used.
As with most inefficient processes that span front, middle and back-office teams, things typically fall down in the coordination between different parties, in this case the tri-party agents, trading desks, and collateral teams. Currently, the process to source information on collateral – an essential step for banks to use it in the market – is often too reliant on email or phone calls. Systems are fragmented and communication siloed between departments.
Optimising the collateral management process in 2026 requires a bridge between all counterparties connecting firms and enabling queries to be resolved quickly. Implementing a communication and workflow platform would enable all sides to reliably keep collateral sets at tri-party agents up to date by routing queries in real time across internal teams, sub-custodians, tri-party agents, and counterparties. This unified platform can reduce manual errors and friction stemming from email and phone-based processes.
Data shows that platforms implemented to optimise collateral processes enable roughly 80% of queries to be resolved within the same-day. This enables decisions to be taken and collateral to be used in the most optimal way, in line with eligibility schedules and counterparty preferences.
Tightening things up will bring huge benefits by itself. But it also provides a solid foundation for innovation in collateral processes. There is a lot of enthusiasm around the potential of tokenised collateral, with regulators such as the CFTC launching a tokenised collateral and stablecoin initiative and banks like JP Morgan accepting Bitcoin and Ethereum as collateral for loans.
Tokenised assets offer significant promise. From a post-trade perspective, they could bring improved asset mobility, liquidity benefits, transparency and greater collateral optionality. By optimising the underlying processes, banks will be in a strong position to test new tokenised proof of concepts.
Using tokenised assets alongside legacy collateral processes is a good way of the industry putting its toe in the water. A lot will be learnt from the use of tokenised assets and how far it can scale during this process, as well as how to assess varied credit and liquidity quality, different regulatory and haircut regimes, differing custody arrangements and testing of potentially novel settlement or delivery protocols.
The goal for 2026 should be for the industry to embed platforms to optimise collateral processes, putting firms in a better position to evaluate and incorporate tokenised collateral if and when eligible. To achieve this, modern communication and workflow platforms are essential infrastructure, just like settlement systems or custody vaults. They can integrate tri-party agents, custodians, and counterparties into a single communication backbone that tightens up legacy processes and enables the introduction of new collateral types.
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