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(Kitoko News) – Binance, the world’s number one cryptocurrency exchange by market share, will allow institutional investors to store collateral from its platform, according to a Bloomberg report released on Monday.
Institutional investors will instead have the option to provide collateral for leveraged positions using Binance Custody, which holds assets in cold wallets instead of the exchange’s internet-connected hot wallets, according to Binance. That’s it. Once the trade is settled, Binance Custody will unlock the assets and users will be able to access them again. According to the exchange, Binance Custody is a separate legal entity founded in 2021 and registered in Lithuania.
Hot wallets of various cryptocurrency companies have been exposed to numerous hacks and other security issues in recent months. Concerns about exchange insiders embezzling user funds have also increased following the collapse of FTX, where billions of dollars of user funds were allegedly leaked to sister company Alameda Research.
Catherine Chen, Head of VIP & Institutional Division at Binance, said: “Users tell us that they love trading on Binance, but at the same time they are under ‘pressure’ from internal risk management. To further expand our activity on Binance, we need to find ways to diversify the exchange’s risk. ”
According to a Binance spokesperson, the company’s institutional arm, which serves proprietary trading firms, hedge funds, family offices and other large clients, will add 17.4 new clients in Q3-Q4 2022. % increased.
Binance is also aiming to increase its workforce in 2023, bucking the trend of other exchanges like Coinbase, which has announced massive layoffs, CEO Changpeng Zhao (CZ) said trading said it plans to hire 15% to 30% more employees. Binance’s personnel also increased from 3,000 in 2021 to nearly 8,000 by the end of 2022.
“We will continue to build and hopefully rise again before the next bull market,” said Zhao.
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