Crypto’s push for instant settlement is creating a capital inefficiency problem, forcing trading firms to fund every transaction in full and raising concerns about how the market can scale as volumes grow.
In practice, that usually means that firms cannot offset what they owe against what they are owed, forcing them to move more capital than necessary to settle trades.
Ethan Buchman, founder of Cycles Protocol and a co-founder of Cosmos, says crypto markets are “asset-brained.” He argues it treats the financial system like a global stock market…
