Binance allows institutions to keep crypto collateral in cold wallets

[ad_1]

Editor’s Note: With such volatility in the markets, stay up to date with daily news! Get our quick roundup of today’s must-see news and expert opinion in minutes. Register here !

(Kitco News) – Binance, the world’s number one cryptocurrency exchange by market share, will allow institutional investors to keep their collateral off the platform, according to a Bloomberg report on Monday.

Binance said institutions would instead have the option of depositing their collateral for leveraged positions with Binance Custody, which will keep their assets in cold wallets rather than internet-connected hot wallets. Once the trades settled, Binance Custody would then unlock the assets and the user would have access to them again. According to the exchange, Binance Custody is a separate legal entity launched in 2021 and registered in Lithuania.

The hot wallets of various crypto firms have been subject to numerous hacks and other security issues over the past few months. Fears that exchange insiders are embezzling user funds have also increased following the collapse of FTX, where billions of user funds were reportedly funneled to sister company Alameda Research.

Our clients are much more aware of risk management, said Catherine Chen, Head of VIP & Institutional at Binance. Our users tell us that they enjoy trading on Binance, but at the same time they are under pressure from their internal risk controls. For them to scale up their business on Binance, they need to look for ways to help them diversify risk on the exchange.

According to a Binance spokesperson, the firm’s institutional division, which serves proprietary trading firms, hedge funds, family offices, and other large clients, saw a 17.4% increase in new clients. between the third and fourth quarters of 2022.

Binance is also looking to increase its workforce in 2023, bucking the trend of other exchanges like Coinbase which have announced major layoffs, with CEO Changpeng Zhao (CZ) saying the exchange plans to hire 15-30% more staff. additional employees. Binances’ workforce has also grown from 3,000 in 2021 to nearly 8,000 by the end of 2022.

We will continue to build and hope to accelerate again ahead of the next bull market, Zhao said.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. This is not a solicitation to trade commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for loss and/or damage resulting from the use of this publication.

[ad_2]