ISDA Publishes Tokenized Collateral Model Provisions For ISDA 2016 Credit Support Annexes For Variation Margin

On December 20, ISDA published the tokenized collateral model provisions for inclusion in ISDA 2016 Credit Support Annexes for Variation Margin (VM) (the "Model Provisions"). The Model Provisions comprise two sets of provisions, one for the English Law ISDA 2016 Credit Support Annexes for Variation Margin (VM) (the "English Law VM CSA") and the other for the New York Law ISDA 2016 Credit Support Annexes for Variation Margin (VM) (the "New York Law VM CSA").

The intended scope of use of the Model Provisions is limited to the situations where the parties to an English Law VM CSA or a New York Law VM CSA (each, a "VM CSA") wish to use tokenized securities or stablecoins transferrable using the distributed ledger technology as collateral under their VM CSA. The Model Provisions allow the parties to a VM CSA to designate certain tokenized digital assets as "DLT Cash" or "DLT Securities" and amend the transfer provisions and the definition of "Local Business Day" in