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Academy Company Updates Article

Introducing new custody trading sub-accounts

2022.06.21 OKX

New controls that make it easy to grant levels of access while protecting the account from unwanted risk for token foundations, investors and trading teams

OKX.com now offers customers, specifically token foundations and high-net-worth investors, easier ways to create, manage and grant access to sub-accounts. We are excited about launching these features to put our customers at ease by giving them more account management controls that help reduce counterparty risk.

At OKX, we don’t use any of our customer funds for leverage or trading. We believe any such activity without the consent of the customer is unethical. At the same time, we feel it is important for entities to understand counterparty risk when entrusting their funds to money managers or a trading team.

Recent events in the industry, such as the incident with 3AC, makes it urgent for us to roll out these features and provide our customers and entities with more control over granting different levels of access within their account. We fundamentally believe it is important for each account owner to be able to permission and have complete knowledge of any trading activity that occurs while using their funds. We believe this is crucial for mitigating systematic risk in the formation of the crypto industry’s next stage of maturity.

With the new custody trading sub-accounts on OKX, third parties or trading teams cannot move funds directly. This is critical for project teams and high-net-worth investors who typically have a third-party trading or advisory team for treasury management. Unfortunately, the Three Arrows Capital incident has highlighted what can happen when the trustless and transparent crypto industry acts on trust and opaqueness. We’re committed to helping users mitigate this kind of systematic risk.

These controls are not meant to limit trading teams or money managers. Our new updates ensure that these new controls don’t restrict any one of the involved parties. In fact, we believe the transparency and new controls will enable a more productive relationship between account owners, foundation teams, money managers and trading teams.

Key features of new sub-accounts

Risk management

  • Notifications of different warning levels
  • A new [trade-freeze] control for sub-accounts
  • Real-time monitoring of leverage and margin use
  • Kill Switch so owners can override any trade decisions
  • Terminate access any time as a primary account holder
  • Limited use of using any treasury for collateralized trading
  • Permission controls for withdrawals managed by primary account holder

Account-level access (across CeFi and DeFi)

  • Permissioning the trading teams for DeFi staking
  • BTC, ETH and SOL options for hedging locked tokens
  • Permissions for sub-accounts where select treasury info is visible
  • Access to spot, margin, futures, perpetual swap and options trading

In addition, clients using a custody trading sub-account can inherit the privileged fee level of the trading team that owns the account, which can include a taker fee as low as VIP8 and maker fee as low as VIP5 (i.e. zero maker fee).

You can read more here about ways to configure sub-accounts or to grant permissions to different teams to access different levels of your account.

Disclaimer: This material should not be taken as the basis for making investment decisions, nor be construed as a recommendation to engage in investment transactions. Trading digital assets involve significant risk and can result in the loss of your invested capital. You should ensure that you fully understand the risk involved and take into consideration your level of experience, investment objectives and seek independent financial advice if necessary.

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