The institutionalization of digital assets has taken a major step forward with a new partnership between Itiviti and Diginex. The combination of Diginex's digital asset market expertise with Itiviti's global NYFIX connectivity platform and Tbricks multi-asset execution automation solution helps solve the challenges faced by financial institutions keen to access and trade cryptocurrencies.

 

“Cryptocurrencies are moving from being a speculative investment predominantly used by retail investors and some hedge funds to becoming a more mainstream asset class,” says Bobby Rahman, Head of Strategic Partnerships at Itiviti. “As institutional firms increasingly accept or adopt cryptocurrencies, we are seeing a surge in demand for greater standardization to connect to and trade with this new asset class.” 

In April, Diginex, a digital asset financial services and advisory company headquartered in Hong Kong, partnered with Itiviti to provide its institutional investors with NYFIX connectivity. The FIX-based order routing network connects over 1,600 buy-side, sell-side, and trading venues across all asset classes, combining state-of-the-art technology and network infrastructure to deliver continuous service and performance. The companies extended their partnership in July to include Itiviti's Tbricks automated solution for risk, P&L, and portfolio management. 

Perfect fit

“Diginex’s mission is to provide improved access and regulated infrastructure to institutions and sophisticated investors looking to participate in this emerging asset class,” says Jonathan Moore, Diginex Product Manager.

For Itiviti, the partnership with Diginex aligns with its strategy of working with best-in-class fintechs globally to bring innovation to its clients. “We are always looking to see how we can benefit our clients by delivering new tools quicker to enhance their workflows, or accelerate their automation, or both. The overarching goal is to provide a competitive advantage to our client base.”

Itiviti looks for two critical elements in a potential partner: the organization must be truly unique in the way it introduces its solutions, and it must be best in its class. “We partner ourselves with companies that are ahead in their thinking and solutions compared with their competitors,” says Rahman.

Itiviti operates in a number of areas in capital markets, including order management systems (OMSs), connectivity, onboarding, testing, and post-trade. In combination, it is able to offer a complete front-to-back trading solution for institutional clients. This allows it to partner across a wide range of areas.

 

Solving the challenges of digital assets

“If you look at Itiviti and Diginex – Itiviti dominates in order management systems and connectivity, while Diginex has a wealth of expertise in the digital assets space,” says Rahman. “Together, we are perfectly positioned to help solve the challenges faced by institutions keen to access and trade cryptocurrencies.”

For Diginex, it is essential that partners have a forward approach to innovation and tackling new markets. “The evolution of the digital assets market is happening at an accelerating pace,” says Moore. “The question has changed from: 'Are crypto assets going to be around in the future?', to 'Yes they are, so what are we going to do about them?' Organizations are starting to think they don't want to be left behind. This is leading to two forms of innovation – first, around the development of financial instruments, and second, in the institutionalization of the market.”

With traditional institutions taking cryptocurrencies more seriously and starting to introduce them to their portfolios and regulators putting stronger frameworks in place to enhance investor protection, Diginex saw a growing need for a standardized way of sending messages and packages of information about digital assets trading. “FIX is the dominant messaging protocol in the traditional financial markets, so it was important for us to form the partnership with Itiviti for NYFIX connectivity at the beginning,” says Moore.

“Moving forward, we looked at how we could partner with Itiviti around their portfolio management capabilities. We recognized Tbricks as an established brand tested in the market for a variety of asset classes. Putting the two together – NYFIX connectivity and Tbricks OMS – solved a major part of the puzzle of how to provide a bridge for traditional institutions to get more involved with digital assets,” says Moore.

 

Driven by client needs

“We are driven wholly by what our clients wish to trade,” says Rahman. 

The multi-asset capabilities of Tbricks was particularly important for Diginex when considering offering portfolio management. “Traditional financial institutions planning to get involved with digital assets don't want to go and buy a separate system to handle these new types of instruments,” says Moore. “So it is really important to have a product that has an open architecture and is scalable and has been tested over a number of years in order for us to say to our clients: here is a solution and its future proof.” 

Itiviti has deliberately designed its architecture to be open and modular, so it can integrate smaller fintech solutions within its platforms easily. “We have also structured our contractual agreements in such as way that it allows our clients to easily opt in to try some of these new solutions,” says Rahman.

 

Investing in innovation

The capital markets are constantly evolving and as a capital markets technology provider, Itiviti cannot afford to stand still. “We are always looking to invest in and refresh our platform, and innovate to benefit our clients,” says Rahman. “We championed standardization when it comes to FIX, and now we have one of the biggest connectivity networks in the world. We see digital assets coming into a standardized workflow as a natural evolution. The combination of having an established platform partnered with a best-in-breed fintech company is powerful.” 

Moore adds that as the institutionalization of digital assets gathers pace, it becomes a question of who is the most efficient in enabling this to happen? “The partnership between Itiviti and Diginex brings a significant level of credibility as well as functionality to the market. This enables us to offer a bridge between the nascent digital assets market and the traditional financial markets.”

Listen to our latest podcast with Diginex

We are glad to introduce our new podcast series “In conversation with” where Itiviti subject matter experts invite partners, clients and industry thought leaders to share and exchange ideas on a wide array of topics pertaining to capital markets.

This podcast episode features Diginex. Bobby Rahman, Head of Strategic Partnership at Itiviti, engages with Jonathan Moore, Product Manager at Diginex in a conversation about Itiviti’s partnership strategy and how joining forces can help foster institutional adoption of digital asset trading.

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