Binance enables off-exchange crypto trade settlement for institutional investors
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Binance on Monday launched an off-exchange settlement solution that will allow institutional investors to keep their collateral used for leveraged positions off its platform, in a move to ease growing concerns about asset safety on cryptocurrency exchanges.
Using Binance Mirror, institutions can post collateral through Binance Custody’s cold storage wallet solution. The assets will be accessible to the user once the trades are settled.
Most crypto investors keep their collateral on the exchange for trading, which could be at risk during market volatility leading to large outflows on a platform. Cold storage wallets eliminate that risk.
“This is an exercise to build trust among institutions that their funds will remain safe,” Markus Thielen, head of research at crypto services firm Matrixport, told CoinDesk.
The top crypto exchange reportedly saw almost one-quarter of its assets lost in the two months after rival FTX (FTT-USD) collapsed.
The company said adoption and use cases for Binance Mirror grew in the last quarter of 2022. Assets in Binance Mirror account for over 60% of total assets secured on Binance Custody.
Earlier, Binance’s crypto trading volume dominated in 2022, ending the year with 66.7% market share.
