Binance Introduces Option for Traders to Hold Assets with Independent Banks
Binance has responded to trust issues and regulatory challenges by introducing options for certain traders to hold their assets with independent banks. This move aims to mitigate counterparty risk and enhance safety for institutional investors, especially in light of ongoing scrutiny from US watchdogs.
Traders Can Now Keep Assets at Independent Banks
Larger traders can now choose to keep their assets at independent banks such as Sygnum Bank and Flow Bank, according to reports. Previously, customers could only hold their funds either on the exchange or via the custodian Ceffu, which US regulators have referred to as a “mysterious Binance-related entity.”
Improving Safety Amidst Regulatory Pressure
Binance’s latest effort is aimed at reducing concerns over the company’s safety following its settlement with the US Department of Justice and the filing of a lawsuit by the US SEC. By enabling traders to hold their assets with independent banks, Binance hopes to address the issue of counterparty risk and provide institutional investors with a safer environment.
Praising the New Offering
A head of a crypto trading firm expressed appreciation for Binance’s new offering, stating that they would prefer to “park” their money with a Swiss bank. This suggests that there is confidence in the security provided by independent banks.
“This arrangement directly tackles the issue of counterparty risk, the primary concern for institutional investors today. Binance has initiated and successfully executed a risk management solution that addresses this concern for all institutional investors in the industry, allowing them to better manage risk and further scale their activity,” the firm concluded.
Hot Take: Binance Enhances Safety Measures for Traders
Binance’s decision to allow certain traders to hold their assets with independent banks demonstrates the company’s commitment to improving safety and mitigating counterparty risk. By offering this option, Binance aims to address trust issues following regulatory challenges and provide institutional investors with a more secure environment. This move is a strategic response to ongoing scrutiny from US watchdogs and highlights Binance’s dedication to enhancing safety measures for its users.
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