Financial Resilience in Digital Assets

The integration of digital assets into the traditional financial ecosystem has raised concerns about unprecedented risks for financial instability. MITRE has developed a suite of capabilities that are designed to assess these concerns and to allow for systemic risk discovery and mitigation strategy refinement through integrated modeling and analytics. 

The nature of the threat to financial resilience is constantly evolving due to the creation of new digital asset currencies and new couplings to the broader financial system. The suite of tools developed through this research is a comprehensive way to examine vulnerabilities and to anticipate financial crises involving digital assets. A decision maker can also utilize these capabilities to test their intervention strategies for mitigating a systemic crisis event as it emerges. The suite includes:

1. Bank Stress Testing Model – explores how digital asset-related stress events can cause financial contagion in banking systems
2. Digital Assets Exchange simulator – replicates trading dynamics and liquidity flows across centralized and decentralized digital assets exchanges to explore how market events such as liquidity crises, price bubbles, price crashes, and market dislocations can develop and propagate
3. Analytics Platform – integrates on-chain and off-chain digital assets market data from several vendors to develop both retrospective and anticipatory analytical reports of market events or new market developments 

These MITRE-developed tools are designed to be used together or separately across a variety of sectors to include financial institutions, regulatory agencies, infrastructure and platform developers, digital assets service providers, as well as local, state, and federal financial agencies. 

For more information about MITRE’s technology, or to inquire about licensing opportunities, contact our Technology Transfer Office at techtransfer@mitre.org.