The fintech firm Capitolis has released a statement highlighting the expansion of its novations platform. This platform, which aims to optimize investors’ portfolios by automatically replacing existing contracts with new ones, has onboarded key buy-side and sell-side market participants.

According to a statement shared by the company on Businesswire, Gil Mandelzis, the CEO and Founder of Capitolis, mentioned: “We’ve seen great benefit in bringing most major market participants together on one automated novations platform, and many that weren’t participating in the past are now actively engaged on the platform.”

Capitolis’ FX novations platform optimizes the needs of various market participants, including prime brokers, executing banks, hedge funds, and money managers. Capitolis is reportedly expanding this network to encompass bank and non-bank customers.

Targeting Optimization of FX Markets

In June, Capitolis joined forces with LCH, the British clearing giant, to enhance risk management in the FX industry. Capitolis embraced LCH's FX Smart Clearing solution to enable banks to optimize risk management across FX forwards, swaps, and cross-currency swaps. This partnership focused on the synergy of LCH's clearing services with Capitolis' post-trade optimization technology.

The fintech firm mentioned that this collaboration can enhance cleared and uncleared markets, ensuring ideal capital and funding allocation.

Capitolis, in partnership with nine major banks, highlighted the potential of FX Smart Clearing. This proof-of-concept yielded a reduction of 42% in total funding costs, signifying a standardized approach to counterparty credit risk methodology, Finance Magnates reported.

Capitolis Expands Offerings for Financial Institutions

James Pearson, the Head of LCH's ForexClear, highlighted how FX Smart Clearing contributes to unlocking capital constraints for banks. During the unveiling of this offering, he mentioned that the platform fosters a safer and more efficient financial ecosystem. This initiative aims to benefit a broader spectrum of market participants.

Established in 2017, Capitolis' mission extends beyond banks to institutional investors. It is backed by prominent venture capital firms like Andreessen Horowitz and Sequoia Capital. According to the company, its latest steps signify the strides in reshaping the FX market landscape.