ISDA Ops by Validus: Streamlining ATE and CSA Threshold Complexity

Validus Risk Management recently launched ISDA Ops, an advanced platform that simplifies the complex task of managing ISDA Additional Termination Events (ATEs) and Credit Support Annex (CSA) thresholds. By automating calculations and real-time monitoring, ISDA Ops addresses the intricate challenges financial institutions face with customized terms and vast data volumes, enhancing efficiency and reducing operational risk. 

The management and monitoring of complex ISDA ATEs and CSA thresholds present significant challenges owing to the intricate nature of the agreements and the sheer volume of data that needs to be tracked and analysed in real time. 

• Complexity of Customized Terms: ATEs allow parties to specify a nearly unlimited range of events that can trigger the termination of an ISDA Master Agreement. These can include credit-related defaults, significant declines in a fund’s net asset value (NAV), or incorrect tax representations. The highly customizable nature of these terms results in a complex mix of structured and unstructured data making standardization difficult and requiring bespoke solutions for monitoring each agreement. 

• Volume of Data Across Multiple Counterparties: Financial institutions often manage thousands of trading lines across numerous counterparties, each with their own specific ATEs and CSA Thresholds. Keeping track of these varied terms manually is not only time-consuming but also prone to errors, increasing operational risk. 

• Real-Time Monitoring Requirements: The dynamic nature of ISDA markets necessitates real-time monitoring of ATEs and CSA thresholds. Delays in identifying breaches or potential collateral calls can lead to undetected exposures and financial losses. 

• Complex Calculations for Collateral Management: CSA Thresholds determine the level of unsecured exposure tolerated before collateral is required. Calculating these thresholds accurately involves complex computations that factor in live market data, exposure levels, and specific contractual terms. 

• Regulatory Compliance and Risk Management: Regulatory frameworks demand stringent risk management practices, including the effective monitoring of counterparty risk and collateral adequacy. Failure to comply can result in regulatory penalties and reputational damage. 

ISDA Ops addresses these issues by providing an intelligent and scalable approach to constructing ATE and CSA Threshold conditions. The platform allows users to analyse and test conditions using live and forecasted data, enabling real-time, proactive decision-making. 

“Managing ISDA ATEs and CSA Thresholds has been a complex task for risk management teams,” said Alain Smith, Head of Client Engagement at Validus Risk Management. “ISDA Ops provides a clear, consolidated view of the data, helping users identify potential breaches and model future risks more effectively,” he said. 

Key features of ISDA Ops include: 

• Automated Tracking and Calculation: Automatically calculates and tracks ISDA ATEs and CSA Thresholds across all counterparties, streamlining risk management processes. 

• Real-Time Risk Management: Enables proactive decision-making by identifying potential collateral calls early, improving management of counterparty and liquidity risks. 

• Enhanced Reporting: Offers intelligent reporting tools that simplify tracking and updating ISDA terms, increasing transparency. 

• Scenario Analytics: Allows users to simulate potential future scenarios using live and forecasted data, proactively addressing potential risks. 

ISDA Ops integrates with Validus’s Horizon platform, including RiskView for hedging monitoring and reporting, TradeView for front-office hedging, and PortfolioView for portfolio-level risk management. This integration enables CSA Thresholds to be updated and monitored within RiskView and incorporates PortfolioView data for condition testing. 

Validus plans to deliver further enhancements to ISDA Ops before the end of the year, incorporating generative AI to efficiently parse complex language and improve data retrieval. Earlier in June, the company announced upgrades to TradeView, enabling automation of pre-trade checks. 

Bitnomial Exchange Implements Eventus Trade Surveillance

Bitnomial Exchange is implementing the Validus solution from trade surveillance and financial risk solutions provider, Eventus. The digital asset derivatives exchange has been collaborating with Eventus since 2021 to integrate order and execution flow for two major futures commission merchant (FCM) clients on the exchange. The decision to fully deploy Validus followed a comprehensive review of Bitnomial’s internal surveillance tools alongside external solutions. 

The move reflects the exchange’s commitment to robust oversight and maintaining and strengthening compliance and market integrity during a period of significant growth by expansion into new products and increasing trading volumes. 

“Integrating Eventus’s advanced surveillance technology with our proprietary systems reinforces our dedication to compliance and transparency,” said Michael Dunn, President of Bitnomial Exchange. “As we continue to grow, it’s crucial that we provide a secure and efficient trading environment for our clients.” 

Eventus CEO Travis Schwab noted the synergy between the two firms. “Bitnomial’s rapid expansion highlights the need for scalable surveillance solutions,” he said. “Our expertise in digital assets and regulatory compliance positions us well to support their evolving needs and uphold the integrity of their markets.” 

In the first half of 2024, Bitnomial reported over $130 million in notional value traded, marking a 1,081% increase from the same period in 2023. Founded in 2014, the Chicago-based exchange offers physically settled Bitcoin futures and options, providing a regulated platform for institutional and professional traders in cryptocurrency derivatives. Recent developments include the introduction of Hashrate futures in partnership with Luxor, targeting Bitcoin miners, and the Commodity Futures Trading Commission’s approval of Bitnomial’s clearinghouse late last year. By enhancing its surveillance infrastructure with Validus, Bitnomial aims to support its expansion while maintaining high standards of market oversight and client trust. 

Connamara Technologies Powers Zero Hash with EP3® Matching Engine for Digital Asset Platform

Zero Hash, the crypto and stablecoin infrastructure provider, has successfully implemented its digital asset platform using the EP3 matching engine from Connamara Technologies, the exchange infrastructure solutions provider.

By leveraging the capabilities of EP3, a scalable and adaptable platform tailored to the dynamic needs of emerging asset markets, Zero Hash aims to enhance its ability to match orders, manage risk, and explore new market opportunities, bolstering its infrastructure for diverse applications such as cross-border payments, trading, tokenisation, and more.

Jim Downs, Co-Founder and CEO of Connamara Technologies, commented: “Zero Hash has assembled a top-notch business and engineering team, and we are honoured that they selected EP3 and Connamara Technologies as technical partners in creating a world-class crypto infrastructure.”

Adam Leaman, Zero Hash Chief Client Officer and Founding Team member, added: “The team at Connamara provides deep technical expertise and market knowledge that has helped Zero Hash scale critical aspects of our product offering to meet market demand. The digital asset space is constantly evolving and Connamara’s ability to adapt and evolve has played a pivotal role in our success.”

S&P Global Market Intelligence Expands Lending Solutions Suite to Enhance Global Loan Markets

S&P Global Market Intelligence has expanded of its lending solutions suite, aiming to drive innovation and operational efficiency in global lending markets. The enhanced suite integrates technology, data, and managed services into a single platform, supporting the entire loan lifecycle, from origination to settlement. Key features include the integration of WSO and iLEVEL for streamlined private credit management, ClearPar Premium Reporting for improved trade processing, and comprehensive end-to-end connectivity across onboarding, KYC, tax validation, and loan settlement processes.

Additionally, the platform offers solutions for CLO managers and advanced loan credit risk analysis, alongside live loan pricing and analytics via S&P Capital IQ Pro. These enhancements are designed to reduce operational risk, improve efficiency, and accelerate loan settlement times.

GCEX Launches Enhanced Market Data Feed and Improved CFD Product with Competitive Spreads

GCEX Group, the regulated digital prime brokerage, has introduced an enhanced market data feed solution covering Equity Index CFDs, Energy CFDs, Commodity CFDs, Crypto CFDs, Spot Crypto, Spot FX, and Bullion. The cost of the data can be offset against trading commissions, offering unrestricted real-time data access, enhanced flexibility and connectivity to active participants, including brokers, hedge funds, and professional traders.

Additionally, GCEX has unveiled an improved CFD product with market-leading spreads on key indices and commodities, such as a 0.45 spread on DAX 30 and a 0.9 spread on US 30. These upgrades reflect GCEX’s ongoing commitment to delivering comprehensive liquidity access across digital assets and FX markets, as well as its continued focus on providing cutting-edge solutions through its XplorDigital suite.

Nonco Partners with TP ICAP’s Fusion Digital Assets to Provide Liquidity for Bitcoin and Ethereum

Nonco, the institutional digital asset trading firm, has partnered with TP ICAP’s Fusion Digital Assets exchange, to act as a liquidity provider for Bitcoin and Ethereum order books on the Fusion platform, aiming to enhance trading efficiency through tighter spreads and increased liquidity.

Fusion Digital Assets, operated by TP ICAP E&C Limited and registered with the FCA, offers a secure, non-custodial trading environment for institutional clients. By joining forces with TP ICAP, Nonco strengthens its commitment to supporting the growth of secure and efficient digital asset markets.

Jeffrey Howard, Head of North America and Partner at Nonco, commented: “Our expertise in digital assets aligns perfectly with TP ICAP’s vision to provide a robust trading platform for institutional players. By enhancing liquidity and ensuring smooth execution, we aim to support the success of this innovative exchange.”

“Nonco has fast emerged as a key player in digital asset trading and we are delighted to welcome them to our exchange,” added Hina Sattar Joshi, Head of Sales at TP ICAP Digital Assets. “At Fusion Digital Assets, we’re committed to growing our institutional client base, offering them fast execution, unique liquidity, transparent pricing, with a regulatory first approach. Our partnership with Nonco is a great step forward in this direction.”

Bitnomial Exchange Selects Eventus Validus Platform for Trade Surveillance Amid Record Growth

The Validus platform from Eventus, the trade surveillance and risk management solutions provider, has been chosen by Bitnomial Exchange to provide comprehensive trade surveillance. Eventus and Bitnomial have collaborated since May 2021, with Eventus initially supporting two futures commission merchants on the exchange.

Bitnomial, a CFTC-regulated exchange offering physically settled Bitcoin futures and options, reported record growth in August 2024, including over $130 million in notional value traded in the first half of the year—an increase of 1,081% compared to 2023. Founded in 2014, the exchange aims to provide a secure, regulated space for institutional cryptocurrency traders, and it recently introduced Hashrate futures in partnership with Luxor, targeting Bitcoin miners.

Michael Dunn, President of Bitnomial Exchange, commented: “Integrating Eventus’ advanced surveillance tools with our proprietary, in-house surveillance system strengthens our commitment to compliance and transparency, while reinforcing the trust our clients place in Bitnomial Exchange.”

Eventus CEO Travis Schwab said: “Our extensive experience in digital assets globally, combined with internal markets and regulatory expertise and a best-of-breed solution, all played a role in this selection. We’re excited to build on our relationship and serve as a trusted partner supporting Bitnomial’s continued growth and the integrity of its markets.”

Validus Risk Management Launches ISDA Ops to Automate Complex ISDA and CSA Threshold Monitoring

Validus Risk Management has introduced ISDA Ops, a new solution designed to automate the calculation and monitoring of ISDA Additional Termination Events (ATEs) and Credit Support Annexes (CSA) Thresholds. ISDA Ops aims to offer an intelligent and scalable platform that simplifies managing these complex terms, improving the efficiency of handling counterparty and liquidity risks. With automated tracking, real-time decision-making, and enhanced reporting, the solution allows financial institutions to better manage collateral requirements and reduce potential risks.

Developed with insights from over 2,000 trading lines and more than 40 counterparties, ISDA Ops provides users with the flexibility to customise conditions through its Expression Builder. The platform’s integration with Validus’ existing Horizon tools further enhances its capability. Validus plans to introduce additional features, including generative AI for more efficient data parsing, before the year’s end.

Alain Smith, Head of Client Engagement at Validus Risk Management, said: “Monitoring and managing ISDA ATEs and CSA Thresholds are crucial risk management functions but has historically proven a major challenge due to the scale and complexity of the task. ISDA Ops therefore represents a significant breakthrough for risk management teams – presenting a clear, consolidated view of the data and allowing users to identify breaches and model for future risks. Cutting-edge technology has made processing huge volumes of data possible, looking to the future our aim is to keep ISDA Ops at the forefront – deploying generative AI to deepen the capabilities of our game-changing solution.”

Instantia Selects ION FX for End-to-End FX Trading & Risk Management

ION, the trading and workflow automation software provider, has announced that Instantia, an Australia-based digital FX and risk management company, has selected ION’s Foreign Exchange (FX) solution. By using ION, Instantia to streamline its FX operations, including trade execution, risk management, and settlement processes for FX cash and derivative products.

Instantia will use ION’s APIs to build customised user interfaces for clients and dealers, enhancing the overall user experience. This collaboration highlights Instantia’s commitment to leveraging cutting-edge technology for optimising currency exchange and cross-border payment solutions.

Richard Poulton, CEO at Instantia, commented: “This partnership is crucial as it will help us revolutionize FX by consolidating currency hedging positions into a user-friendly interface and expand into other APAC markets.”

Alex Pirmohamed, Chief Product Officer at ION Markets (FX), said: “The ION FX end-to-end solution uniquely suits institutions providing FX services for cross-border payments, and FX risk management. Our platform’s robust functionality facilitated Instantia’s quick time to market, and we remain dedicated to supporting their ambitious objectives.”

Connamara/Acuity Study Finds Emerging Market Derivatives Exchanges Face Technology Hurdles in International Growth

A study by Acuiti, in collaboration with Connamara Technologies, highlights the challenges emerging and frontier market derivatives exchanges face due to outdated technology. The report, “Building Competitive Technology for the Exchanges of the Future,” is based on surveys and interviews with 58 senior executives globally. It reveals that 87% of exchanges in emerging markets view technology investment as crucial for growth, particularly to attract international members. However, less than half have upgraded their matching engines in the past six years, leaving them behind tier 2 and 3 exchanges.

Outsourcing technology, particularly for surveillance systems, is common among these exchanges, with firms reporting better cost predictability and timelines when working with specialist vendors. Key concerns include exchange outages and the need for customisable software, with 67% of respondents planning significant technology investments in the next year.

Jim Downs, Co-Founder & CEO of Connamara Technologies, comments: “Acuiti’s rigorous study validates the clear demand for exchange platforms that offer the cost-effective benefits of a pre-packaged solution while also providing the tailored features and flexibility of a custombuilt platform.”