Monte Cristo

Problem: The current system requires Currency Market participants to face a third party (credit intermediary/ PB) to get comfort that their MTM trading gains will materialize. This system is 1) expensive, 2) consumes capital/ collateral because of inefficient outdated settlement processes, 3) places constraints on trading activity. In the world of Digital Currencies, very few reliable credit intermediaries exist and where they do, their cost is high, and availability is limited.

 

Solution: In Monte Cristo we now have a validated non-bank legal structure that leverages Letters of Credit and the technology and business logic from Integral that will allow market participants to trade with each other without the third party (PB) by being sure that they will get paid for their trading gains via an independently managed collateral system and high-frequency transfers that crystallize their gains in real time. This means less collateral/ capital, less risk exposure and lower cost. This model is immediately applicable to FIAT and Digital Currency products.

 

How does this work: We have created a platform that allows both parties (to the trade) to settle with each other at very frequent intervals (10 minutes x 24 hrs. a day for FX) instead of the current standard widely used settlement standard among PBs and exchanges which is 1 day (plus a few potential further days for reconciliation and problem resolution). The traditional credit intermediation system uses the legacy bank wire transfer system which doesn’t allow for frequent automated transfers based on authoritative real time mark-to-market valuations 24 hours a day. Our platform uses digitized USD to be settled in an automated manner that creates a trustless credit mechanism based on state-of-the-art technology deployed specifically for credit solutions. All sat on the proven Letter of Credit system.