Binance Permits High-Volume Traders to Store Assets Off-Platform: FT

• Binance Now Supports Crypto Holding in Independent Banks
• Alternative Crypto-Friendly Institutions
• Binance's Regulatory Disputes
• Banking Triparty Arrangement Explored
• Response to Regulatory Concerns

Binance Now Supports Crypto Holding in Independent Banks

The leading cryptocurrency exchange, Binance, has recently announced a significant change in its policy. Large-scale traders are now able to store their assets in independent banks. According to a Tuesday report by the Financial Times, these traders were previously required to hold their assets on the exchange platform or with its custodial partner, Ceffu.

Alternative Crypto-Friendly Institutions

With this new update, traders have the option of utilizing crypto-friendly institutions such as Sygnum or FlowBank, both Swiss banks acknowledged for their crypto-friendly regulations. This hints at a possible shift in Binance's approach to asset storage, possibly due to the prevailing regulatory issues surrounding the exchange.

Binance's Regulatory Disputes

Binance's ongoing regulatory dispute in the U.S., which resulted in a staggering fine of $4.3 billion in November, has raised several concerns among users. These anxieties were magnified after the bankruptcy of its competitor, FTX$3.28 -5.38%, the previous year. According to the FT, an anonymous head of a crypto trading firm stated a preference for storing funds with a Swiss bank over Binance.

Banking Triparty Arrangement Explored

Binance disclosed that it has been considering a banking triparty arrangement for almost two years. This arrangement would involve its customers and a bank custodian. However, the exchange refrained from providing specific details about the banks involved. Binance further emphasized that concerns about counterparty risk are prevalent across the industry and not unique to their platform.

Response to Regulatory Concerns

Despite reaching out for additional comments, there has been no immediate response from Binance. Regardless, this recent development indicates the exchange's efforts to address growing regulatory concerns and provide an enhanced security framework for its users' assets.

Edited by Jonathan Stoker