Binance allows large investors to hold their assets in independent banks

Cryptocurrency exchange Binance has reportedly implemented a change that allows larger traders to secure their assets with independent banks.

Previously, traders were required to hold their assets either directly on the exchange or with its custody partner Ceffu.

The new policy allows the use of friendly to cryptocurrencies institutions such as the Swiss banks Sygnum or FlowBank.

This one correction Binance's approach may be in response to user concerns stemming from its regulatory dispute in the US, where in November it was imposed a fine of $4.3 billion.

These concerns were reinforced by the bankruptcy of rival exchange FTX the previous year.

In November, Binance had announced that it had been exploring the possibility of entering into a banking tripartite agreement for more than a year. The term refers to an arrangement involving the exchange, its customers and a custodian bank.

However, the specific names of the participating banks were not disclosed. A spokesperson for the crypto exchange emphasized that their “decision on banking tripartite cooperation” aims to facilitate wider adoption among institutional investors.

The spokesperson explained that this long-standing model allows investors to manage risk while optimizing capital efficiency by pledging collateral in the form of traditional assets.