The FTX crisis has further heated up centralized cryptocurrency exchanges, and cold wallets are now in the spotlight. It’s no surprise that the world’s largest cryptocurrency exchange allows institutional investors to store their cryptocurrencies in cold storage solutions.
Binance has announced a new service called “Binance Mirror”. It is an off-exchange settlement solution that allows institutional investors to access trading and investment products within the exchange ecosystem without directly posting collateral.
New on Binance
According to the official press release, financial institutions can lock a certain amount of their asset balance in Binance Custody’s cold storage facility and mirror it to their exchange account with a 1:1 balance. The platform emphasized that user funds will be kept safe in segregated cold wallets “as long as exchanges have open mirror positions that can be settled at any time.”
The move essentially allows investors to continue trading even during volatile sessions without suffering massive outflows on exchanges.
Following the announcement, Binance Custody Vice President Athena Yu said:
“Security is a top priority for institutions seeking the deep liquidity offered by Binance Exchange. Binance Mirror brings the best of both worlds. We have spent a lot of time improving our operations so that we can continue to do so, and we are very excited about how things are today and can’t wait to introduce upcoming new features that will make Binance Mirror even better. I can’t.”
Binance 2023 Roadmap
The dramatic collapse of Binance rival crypto exchange FTX last November marked a turbulent time and a prolonged crypto winter. There are growing concerns about the ability of centralized exchanges to retain users’ funds. Some cryptocurrency companies have resorted to issuing proof of readiness reports to ease fears. However, many have announced furloughs and others have stopped hiring.
Meanwhile, Binance plans to expand its workforce by up to 30% this year. The CZ-led platform has also obtained registration from the Swedish Financial Supervisory Authority as a financial institution to manage and trade cryptocurrencies. This makes Sweden her seventh EU jurisdiction to greenlight Binance.
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