Flowdesk recently secured a full broker-dealer licence in Dubai from the Virtual Assets Regulatory Authority to complement its European Markets in Crypto-Assets regulation. How do these two frameworks differ in practice for a digital asset market maker, and how does holding both reshape your ability to serve global institutional clients?
Markets in Crypto-Assets (MiCA) and the Virtual Assets Regulatory Authority (VARA) build out different opportunities. MiCA is a single rulebook. After the local financial authority authorises you — in our case, the Autorité des marchés financiers (AMF) in France — once passported, to operate across Europe, which matters when your clients sit in a dozen countries that each used to want their own answer. While this requires elevating our controls and governance to a standard most crypto companies have never run at, it raises the bar for firms operating in the space, helping put digital assets into a framework that TradFi institutions understand.
VARA issues licences by activity, so the broker-dealer permission maps onto what we do for institutions. The regulator there understands tokenisation; they react fast, and they let us trade in a regulated fold. Holding both licences enables us to continue servicing clients without asking them to compromise.
While many TradFi players have historically viewed compliance as an operational burden, Flowdesk says it is a chance to drive growth. How has operating as a fully licensed entity altered the nature of your conversations with Tier-1 banks, asset managers, hedge funds, and other institutions?
Most of our early conversations with institutions used to revolve around who we are, where we are domiciled, what happens to a client’s assets if something breaks, and whether a credit committee could approve a counterparty of our shape at all. With MiCA and VARA in place, those questions are settled before we sit down, and the discussion starts where it should: on the liquidity solutions we can provide, the size we can price, and the way we support a client’s positions across time zones. An institution will work with three or four counterparties in this market rather than twenty, and regulatory standing now determines whether a firm is even reviewed for that seat.
What’s happened in Europe with MiCA shows what regulation does to a market; the standard has risen, with the number of participants consolidated faster than the opportunity itself has been altered.
The cost of operating in a compliant way is intentional, and I would not present two licences as something that arrived without consequence, because institutionalising a firm of our size reaches into how we hire, how we ship code, and how we govern processes we already believed were sound. We committed to it on the view that the next cycle will be carried by regulated assets, which makes this a strategic period to absorb those necessities.
With institutional flow increasingly moving onchain, how are your execution algorithms adapting to handle toxic order flow, MEV, and latency arbitrage across hybrid CEX-DEX venues?
Part of that activity is moving onchain, although where a trade executes and where it settles are separate questions, and a large part of the institutional business we handle continues to execute offchain across venues our clients already know well.
When we operate onchain, we assess the venue as a counterparty before we treat it as a source of liquidity, because cyber-risk sits at an all-time high in this market and the caution the industry has developed around protocol exposure has been earned the hard way.
Adverse selection is a pricing question before it becomes a technology question, and our liquidity solutions are built on the assumption that someone on the other side could know something we do not. Connectivity to more than 150 venues means positions we take on one side of the market have somewhere to go on the other.
Value extracted around an onchain transaction is a cost of execution in the same way that spread and fees are. So we measure it, price it into what we show, and route around it where viable. Speed matters where it changes the outcome for the client, and it matters less in venues where winning a latency race adds nothing to the price they receive.
The human layer underneath all of this has not moved, since humans review production trading code before it ships, and humans sign every single transaction that leaves the firm. We want the institutions committing real balance sheets to this market to read that as reassurance, rather than as a limit on how fast we can move.
Traditional finance is creeping closer to crypto-native operational hours, demonstrated by Nasdaq’s recent plans to launch 23-hour trading. How are 24/7/365 liquidity rails and execution engines adapting to handle the convergence of tokenised real-world assets and traditional instruments?
The first problem is pricing, because when the reference market is closed, you are no longer quoting against a live price, and you have to price the risk between the last close and the next open, which means thinking about the volatility of that window rather than the last traded price.
Corporate actions sit close behind, since dividends, splits, ticker changes, and trading halts are well understood in traditional markets and still need to be accounted for once the asset sits onchain, which puts the burden on the infrastructure to reflect those events correctly. Inventory is the harder one, because providing liquidity at scale depends on creating and redeeming against the underlying.
When the token settles immediately while the underlying still settles on a traditional cycle, someone has to finance the difference.
Little of this is exotic, and most of it is operational plumbing, but getting the plumbing right is what will make 24/7/365 continuous trading work in practice.
As RWA tokenisation gains momentum, what are the biggest liquidity or market structure bottlenecks currently preventing seamless secondary market trading for these assets?
The bottlenecks are what you would expect in a market only a few years old, and they cluster around the assets where we see the real potential: equities, ETFs, and funds, where liquidity, price discovery, custody, and settlement already exist offchain.
Fungibility is the first bottleneck, since the same underlying asset can be represented by several tokens with different structures and redemption terms, which spreads liquidity across venues that cannot net against each other.
As issuance standardises, that liquidity should come back together, because a token representing the same entitlement in a consistent way is far easier for the market to support.
The second is how narrow the channel remains between the token and the underlying. Quoting in size depends on building and unwinding inventory against that underlying, and too few participants can do it today, which keeps depth thinner than institutional demand warrants.
The market solved versions of these problems for ETFs years ago, and we are applying the same lessons to a new set of rails on a shorter timeline.
You have noted a shift in institutional behaviour from passive allocation to active, integrated deployment. What specific trading strategies and OTC flow trends are you seeing from institutional counterparties so far in 2026?
I would frame it differently: as allocation to digital assets has not grown this year, some of that capital has rotated towards AI, and what remains is a smaller pool behaving more professionally, which matters more than the headline number.
The capital that stayed does less outright directional trading and more basis and funding work, hedges longer-tail positions with OTC options, and finances inventory rather than holding it outright, while stablecoins now serve as settlement and margin as much as they serve as something to hold.
We see it in what comes through the OTC business, where requests for structured products and financing have grown while directional tickets have thinned. Tokenised assets are also arriving as an execution channel rather than as a topic of conversation, and the volume remains small against the rest of the book, though it is becoming meaningful.
Counterparty risk and collateral efficiency remain paramount for institutions. How are your clients balancing off-exchange settlement and custody solutions with the need for immediate execution speed?
Exchanges used to require pre-funded wallets, which trapped cash on-venue and left firms carrying counterparty risk nobody was paying them to take.
The institutions we deal with now route around that through off-exchange settlement networks, third-party custody, and prime broker frameworks, which keep their assets inside regulated custody while credit lines preserve their access to venues in real time.
The capital stays protected, the balance sheet stays free once custody and trading are separated, and the credit line exists to make sure none of that costs them speed at the point of execution. It is also why a counterparty with our connectivity can be useful to a bank without ever holding a single asset of theirs.
Looking across the remainder of 2026, what key regulatory or structural catalyst do you believe will drive the next major wave of TradFi capital into digital asset market infrastructure?
Regulation carries most of the answer, but the part I would draw out for the rest of this year is where these assets are allowed to sit.
Traditional capital moves at scale when a tokenised equity or fund can be held in the same custody and settled through the same controls an institution already runs for the rest of its book, so that the trade requires no exception from a risk committee.
Firms are convinced about the direction. The obstacle is size, and the fear that travels with it, because a committee that has watched others lose funds onchain will hesitate before moving a billion dollars, and that hesitation only lifts with time, education, and a run of clean operating history within a licensed framework.
Regulation is still catching up, which is why I would describe this as a phase that runs for another four or five years rather than a single catalyst that lands in one quarter.
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