Algorand
$1.49 11.11%
ALGO · 1d

A closer look at the ISDA partnership

This is partly in response to the consistent questioning of Algorand's marketing efforts. I understand why people may feel like marketing is lacking, and truth be told there isn't in much in the way (yet) of dapps. But, and I mean BUT, I think the market is sleeping on the big partnerships that Algorand already has in place. Let's take a crack at this. My favorite project, and what drew me to Algorand, is the ISDA partnership. I've had an interest in how blockchain can be implemented in the derivatives market for a little while now. I can not overstate the potential of this deal for Algorand and for us hodlers. Let me explain. There are 2 derivatives markets, exchange-traded and over-the-counter (OTC). Exchanged-traded derivatives are cleared by a central entity that guarantees each side of a trade such that there is no credit risk. Options Clearing Corp handles this for listed options in US stocks for example. In the OTC market there is no guarantor in the middle and thus there exists credit risk between the parties. The most active market, interest rate swaps (60% of the market) largely trades over the counter. This brings me to my point. The OTC derivatives market is an insanely large $4.6 trillion vs. $0.1 trillion for exchange traded products. The total size of the OTC derivatives market is on the order of $700 trillion in notional value. Source - [https://www.bis.org/publ/qtrpdf/r\_qt1909y.htm](https://www.bis.org/publ/qtrpdf/r_qt1909y.htm) ​ ISDA standardizes documentation in the OTC derivatives market with the aim of reducing credit risk among other functions. Quite simply, ISDA ***IS*** the OTC derivatives market when it comes to documentation. For our purposes, a monopoly. Investopedia: *An ISDA Master Agreement is the standard document regularly used to govern over-the-counter* [*derivatives*](https://www.investopedia.com/terms/d/derivative.asp) *transactions. The agreement, which is published by the International Swaps and Derivative...
Continue on self.AlgorandOfficial
Recent news
ALGO +11.11% · theglobalfintechintelligencer.com · 8h

Kiffmeister's CBDC known knowns update

I’ve tabulated all of the central bank and sovereign digital currency launches and pilots I know of that have revealed their technology partners and platforms. I didn’t include the Sout…