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What Is the Role of a Clearing House in Traditional Finance Finality?

A clearing house acts as a central counterparty (CCP), guaranteeing trade execution and settlement to ensure finality and manage credit risk.
Greeks.Live07.11.25

What Is the Role of a Clearing House in Traditional Finance Finality?

A clearing house acts as a central counterparty (CCP) that interposes itself between the buyer and seller of a financial contract, guaranteeing the trade's execution and settlement. By taking on the credit risk, the clearing house ensures finality even if one of the original parties defaults.

This centralized guarantee is replaced by cryptographic finality in blockchain systems.

What Is Counterparty Risk and How Is It Mitigated on Centralized Crypto Options Exchanges?
What Is the Role of a Clearing House in a Standardized Crypto Derivatives Exchange?
What Is the Role of the Clearing House in Validating and Settling Options Contracts?
How Does a Clearing House Mitigate Counterparty Risk in Futures Trading?

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