Major Binance Announcement Concerning Larger Traders (Report)

TL;DR

• Binance has introduced options for certain traders to hold assets with independent banks, in response to trust issues following the FTX collapse and regulatory challenges.
• The company’s new strategy aims to mitigate counterparty risk and enhance safety for institutional investors, amidst ongoing scrutiny from US watchdogs.

Binance has reportedly enabled larger traders to keep their assets at independent banks, such as Sygnum Bank and Flow Bank.

Previously, customers could only hold their funds either on the exchange or via the custodian Ceffu. The United States regulators have referred to the latter as a “mysterious Binance-related entity.”

Binance’s latest effort could reduce the growing unease over the company’s safety since it was a main target of the US Department of Justice. In November last year, the firm settled with the agency and agreed to pay a whopping fine of $4.3 billion over money-laundering violations, while CEO Changpeng Zhao (CZ) resigned from his post.

Prior to that, the US SEC filed a lawsuit against Binance, accusing it of offering trading services with unregistered alleged securities.

A head of a crypto trading firm, whose name was not disclosed, praised the new offering, saying they’d rather “park” their money with a Swiss bank. 

Binance supposedly stated that it had started exploring the “banking triparty solution” almost two years ago (before the attacks coming from the SEC and the DOJ). 

“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.

The post Major Binance Announcement Concerning Larger Traders (Report) appeared first on CryptoPotato.