How Does a Non-Custodial Model Affect Counterparty Risk in an RFQ Environment?

In a non-custodial RFQ model, the platform itself is not exposed to the risk of holding client funds or assets. However, the counterparties in the trade still face each other's credit risk until settlement is complete.

The platform often mitigates this by vetting participants and sometimes integrating with clearing mechanisms. Ultimately, the risk remains directly between the buyer and seller.