TD Securities Picks Paxos to Automate Commodity Trading

TD Securities has chosen Paxos Settlement Service for Commodities, marking an advancement in the precious metals market by adopting blockchain technology for trade settlements. This collaboration brings the first instance of concurrent cash and commodity trade settlements, optimizing TD Securities’ operations in both traditional and digital precious metals markets.

TD Securities has selected Paxos to provide a blockchain-based settlement service for commodities trades, enhancing automation in a sector that traditionally lacks such systems. This development is poised to modernize the approach to commodities trading, offering a solution to the longstanding absence of automated confirmations and settlements.

“Bridging the longstanding gap between cash and asset settlement networks, as well as collecting settlement obligations in a controlled way that mitigates risk, are fundamental elements to creating safe settlement for the commodities market,” Joe Quinlan, the Global Head of FX & Commodities Middle Office at TD Securities, highlighted the importance of synchronized cash and asset settlement networks and the controlled collection of settlement obligations.

“Aside from the risk mitigation, joining this settlement network enables us to drive significant benefits to our processes, increasing our overall settlement efficiency.”

Paxos stands as a pivotal entity in regulated blockchain infrastructure and tokenization, shaping a more agile and open financial system. The company has collaborated with prominent institutions like PayPal and Bank of America to facilitate asset tokenization, custody, and transaction services, and has garnered significant investment, illustrating its impact on the financial industry’s evolution.

Anoushka Rayner, Head of Growth of Commodities at Paxos, emphasized the dual advantages of reduced credit risk and capital efficiency gains. According to Rayner, Paxos facilitates simultaneous settlements and serves as a central hub for all counterparty settlements.

“TD Securities will be able to optimize its commodities business with full automation from post-trade confirmation to final settlement,” she concluded.

Finance Magnates informed last week that TD Securities has also joined forces with Tradefeedr for better data analytics in the Forex industry. The company has integrated with Tradefeedr’s independent FX Data Analytics Platform.

Paxos Encounters Regulatory Challenges in the Cryptocurrency Market

In light of regulatory issues major cryptocurrency exchanges face in the United States, Paxos began the year with a setback. In February, news surfaced that it is facing an investigation by the New York State Department of Financial Services (NYDFS).

Just a few days later, the company announced that it is halting the minting of the Binance-affiliated stablecoin BUSD, following reports that the Securities and Exchange Commission (SEC) also intends to sue the firm.

However, this did not deter Paxos from supporting other stablecoin developments. In September, the company partnered with Crypto.com and PayPal concerning a new USD-pegged token from payment giant PYUSD.