As we move further into decentralized finance (DeFi) and crypto technologies, the subject of financial risk within this new landscape is ever more prevalent. In late March 2022, Solidus Labs launched their HALO hub, tailored specifically to tackle this issue.
HALO is described as the first automated, comprehensive, and testable trade surveillance and market integrity hub tailored for digital assets. It focuses on addressing the “Triple T” (T3) pillars of market integrity of the crypto and DeFi space:
Asaf Meir, Founder and CEO of Solidus Labs said, “Crypto’s potential to make financial services more accessible, transparent, liquid, and efficient depends on state-of-the-art financial risk monitoring that enables the merits of digital assets. While surgically mitigating its many new risks.”
“HALO does that by unifying formerly disparate risk data points and continually monitoring that data in real-time, creating a behavioral-based universal client risk profile that allows our clients to focus on real risk, in real-time, throughout the investment journey.”
The ‘Triple T’ of market integrity
Addressing the “three pillars” of market integrity of the crypto and DeFi space is integral to the HALO offering. Given the volatility and general lack of understanding of crypto technologies, risk platforms and monitoring services may be essential to proper integration into the traditional finance sector.
The surveillance tools implemented by the platform benchmark abnormal crypto orders and execution patterns against the market norm. With this, HALO can identify abnormal volatility and potential breaches of trading rules and notify businesses and networks.
The transaction monitoring function protects users from suspicious transactions and withdrawals, keeping all activity compliant with sanctions, financial risk, and anti-money laundering. In addition, HALO’s Universal Client Risk Profile assesses risk across the market for the entirety of the investment journey, initiating stress tests and synthesized threat scenarios so clients can act in real-time.
Approaching the market holistically, HALO covers the three pillars simultaneously to monitor the market correctly. Users can customize the platform to adjust sensitivity and respond to changes in regulation, making it a tool that extends into the future market.
Breakthrough for Solidus Labs and the crypto space
Solidus Labs has an established track record addressing risk within the crypto space. Since launching in 2018 to bridge the regulatory, risk, and compliance gap between crypto and the traditional financial world, they have been working to monitor and safeguard crypto markets worldwide for millions of entities.
They focus on digital assets, crypto, and DeFi’s potential to make finance more accessible, transparent, fair, and efficient, describing themselves as a “crypto-native company – heart, body, and soul.”
The HALO platform is a significant development for the company, helping them tackle the issues it set out to address.
“Since our founding, our deepest commitment has been to enable a safer crypto ecosystem. HALO brings us one step closer to that goal while taking user experience to the next level, empowering risk and compliance teams and allowing crypto businesses to grow safer,” Meir said.
“It’s a culmination of thousands of hours of work with crypto teams and discussions with regulators, fulfilling our vision of harnessing crypto as an opportunity to transform financial services and take financial risk monitoring into the future.”
Serving the global crypto market
Aimed at serving the global market, HALO is already used by more than 25 million retail and institutional investors worldwide. Deploying over 50 different propriety market abuse typologies, it monitors over one trillion events per day and safeguards crypto and DeFi space businesses from threats.
In addition to businesses and institutions in the private sector, the platform also seeks to offer governmental bodies tools to assist with integrating crypto technologies. As more of the world seems to be moving in this direction, security and risk to the existing financial infrastructure are a significant focus of the governments implementing these technologies.
Aimed at enhancing transparency and security, Solidus Labs addresses this transition with the HALO tools, which address many crypto-specific challenges such as new market structures, data types, crypto-native abuse typologies, and the volatility associated with cryptocurrencies.
In this way, they hope to assist in the safe and transparent regulation of crypto financial services and enhanced integration of DeFi technology into the fabric of the financial market in the future.
Isabelle is a journalist for Fintech Nexus News and leads the Fintech Coffee Break podcast.
Isabelle's interest in fintech comes from a yearning to understand society's rapid digitalization and its potential, a topic she has often addressed during her academic pursuits and journalistic career.