Binance is collaborating with Spanish banking giant BBVA to enhance the security of customer cryptocurrency holdings. The partnership will enable users of the exchange to store their digital assets within BBVA’s custody infrastructure.
The primary objective of this arrangement is to mitigate risks associated with relying solely on exchange custody. By leveraging BBVA’s regulated banking framework, Binance aims to safeguard customer assets and prevent a repeat of scenarios like the FTX collapse, where user funds were commingled and became inaccessible.
Under the new system, assets held by Binance users at BBVA can potentially be utilized as margin collateral for trading activities executed on the Binance platform.
This collaboration forms part of Binance’s ongoing strategy to bolster the security and trustworthiness of its asset storage solutions through partnerships with regulated financial institutions. The exchange has previously established similar custody arrangements with banks, including Switzerland’s Sygnum and FlowBank.
The partnership with BBVA directly addresses growing demand for secure crypto custody models, reinforcing Binance’s efforts to establish greater trust in the storage of digital assets by reducing reliance on exchange-controlled wallets.