Binance is working with Spanish bank BBVA to allow customers to hold their assets off the crypto exchange, as it tries to reassure investors following its record fine by US authorities nearly two years ago, according to the Financial Times.
Spain’s third-largest bank recently began working as one of only a small number of independent custodians for the world’s biggest crypto exchange, according to two people familiar with the arrangement.
The move to work with BBVA comes as traditional banks become increasingly comfortable with holding and trading cryptocurrencies and working with digital asset exchanges. Sentiment has been boosted by the Trump administration’s staunch support for the crypto industry, which has also helped pushed the price of bitcoin to record highs and sent trading volumes soaring this year.
The custody arrangement with BBVA means that traders’ money sits with the Spanish bank in US Treasuries, which Binance then accepts as margin for trades on the exchange, the person familiar with the arrangement said, adding that the structure is “mitigating a hypothetical FTX 2.0
The other person familiar with the arrangement said digital asset exchanges including Binance understand traders wanting “to use a third party and have the collateral be in a safe place”.
BBVA has been expanding in crypto to meet what it says is growing demand from its retail customers. Last month it launched bitcoin and ether trading and custody services directly through the bank’s mobile app for its Spanish clients. Meanwhile, it has advised its private banking clients to invest up to 7 per cent of their portfolios in crypto assets.
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