Crypto Trade Settlement

Overview

When a crypto trade occurs on the Cybrid platform there are numerous steps and associated timelines that occur behind the scenes. Crypto trades are not settled immediately, they are collected and batched twice a day during settlement windows. Settlement batches include trades for every customer on the Cybrid platfrom, across every partner. Cybrid cannot perform settlement for an individual trade out of band from our settlement window.

High Level Overview of Settlement Process

The following steps are involved in the process:

• A trade quote is obtained for a customer or bank on the platform
• A trade quote is executed via the trades endpoint and the trade enters a settling state if successful
• The settling trade is collected in the next batch settlement window
• Cybrid executes trade settlement with liquidity providers twice daily (outlined below)
  • Fiat or crypto is sent from Cybrid to liquidity providers
  • Fiat or crypto is received from liquidity providers to Cybrid
• Once Cybrid receives the trade settlement (fiat or crypto) account balances are updated

When is a trade settling?

A trade that is in the state settling will be part of our settlement process.

Funds associated with this trade will be aggregated in the assets trading account under platform_balance, and will not appear in the value platform_available.

When settlement for the trade has completed the trade will be in the state completed. The funds associated with the trade will then be aggregated in the assets trading account under both platform_balance and platform_available.

Settlement Timelines

Settlement occurs on business days only, as it requires fiat funds to be sent on our sponsor banking rails, which only run during eastern business hours. As such, Cybrid cannot process settlement on weekends or traditional bank holidays. Cybrid notifies partners via Slack when there are upcoming bank holidays or other issues which may impact settlement.

The following diagrams shows:

• When trades are collected for the batch settlement windows
• When settlement begins during the two daily settlement windows (10AM and 3PM EST)
• When trades typically complete at the end of their settlement window (~3-5 hours after start)

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Note: Trades that have not occurred when batch process begins will be included in the next batch processing window. This may be on the following business day.

Bitcoin Lightning Network

The Cybrid Platform processes Bitcoin Lightning Network transactions in the following manner:

• Bitcoin Lightning Network settlement occurs once every business day at approximately 7am Eastern.

What can impact settlement?

A variety of things can impact settlement timelines:

• Weekends and Bank Holidays
• Delays in banking infrastructure and FedWire wire transfers
• Delays from liquidity providers settling wires or releasing crypto assets
• Delays from liquidity providers settling crypto and releasing wires
• Crypto network congestion and blockchain confirmations
• Compliance screening policies and manual compliance review