OKX and Standard Chartered Launch Crypto Collateral Program Under VARA

The initiative, announced on April 10, allows institutions to use cryptocurrencies and tokenized money market funds as collateral without transferring custody to the exchange. Instead, the assets are held securely by Standard Chartered, which acts as the independent and regulated custodian under the oversight of Dubai’s Virtual Asset Regulatory Authority (VARA). The program is hosted within the Dubai International Financial Centre (DIFC) and adheres to strict compliance protocols laid out by the Dubai Financial Services Authority (DFSA).

Star Xu, CEO of OKX, announced on X that the company is taking its next step in bridging TradFi and crypto by partnering with Standard Chartered, Brevan Howard, and Franklin Templeton on a VARA-backed collateral mirroring program aimed at boosting capital efficiency and reducing risk.

This “mirrored collateral” structure enables institutional clients to trade on OKX while keeping full custody of their digital assets with a globally recognized financial institution. By doing so, it mitigates the counterparty risk typically associated with crypto exchanges, particularly relevant in the wake of recent collapses and bankruptcies in the crypto sector.

The pilot program has already attracted major players. Asset management giant Franklin Templeton will offer tokenized money market funds through the initiative, while digital investment firm Brevan Howard Digital is also participating, signaling a high level of confidence from top-tier institutions in the solution's structure.

From a technical standpoint, the mirroring program operates by reflecting the value of off-exchange crypto collateral into clients’ OKX trading accounts. Standard Chartered retains control over the actual assets, ensuring that they are safeguarded and available only under pre-agreed terms. This separation of duties means that OKX never takes custody of the funds—adding a vital layer of protection in the eyes of compliance officers and institutional risk managers.

The partnership comes amid rising global demand for institutional-grade infrastructure in the digital asset space. While retail investors continue to dominate headlines, institutions have steadily increased their exposure to crypto markets, but often with hesitation due to concerns over asset custody, regulatory clarity, and operational risk.

The Dubai location is no accident. The emirate has positioned itself as a crypto-friendly hub with clear and progressive regulatory policies. VARA’s framework is increasingly viewed as a blueprint for how digital asset oversight can coexist with innovation. By building the program within this ecosystem, OKX and Standard Chartered ensure both regulatory legitimacy and operational flexibility.

Industry analysts say the mirroring initiative could serve as a model for future collaborations between banks and crypto platforms. With regulatory crackdowns in the U.S. and Europe tightening, many institutional players are looking toward regulated, non-custodial solutions to maintain their exposure while staying compliant.

As crypto matures, the ability to integrate with the broader financial system, particularly through mechanisms like collateral mirroring, is likely to become a cornerstone of future growth.

The OKX-Standard Chartered partnership marks a turning point in that evolution, merging the liquidity and innovation of crypto markets with the institutional safeguards of traditional finance. If successful, it could catalyze a new wave of adoption among hedge funds, family offices, and asset managers worldwide.