Binance expands custody network with Spain’s BBVA to store assets in $US Treasuries
Main Idea
Binance has partnered with Spain's BBVA to store trader assets in US Treasuries, expanding its custody network to enhance fund security and reduce counterparty risks, following similar collaborations with Swiss banks.
Key Points
1. Binance's partnership with BBVA aims to safeguard trader assets by holding them in US Treasuries rather than on Binance's exchange wallets.
2. This move is part of Binance's strategy to prevent risks similar to the 2022 FTX collapse, which involved poor asset segregation and management.
3. Binance has previously partnered with Swiss banks Sygnum and FlowBank to expand custody options and meet jurisdictional requirements.
4. The use of US Treasuries as collateral provides liquidity and helps reduce systemic risks in the crypto sector.
Description
Binance has added Banco Bilbao Vizcaya Argentaria (BBVA), Spain’s third-largest bank, to its roster of independent custodians in a bid to safeguard customer funds and reduce counterparty risks. According to a report by the Financial Times , the arrangement will see traders’ collateral stored with BBVA in US Treasuries, which Binance will then accept as margin for trading on its platform. The move reflects a wider strategy by the world’s largest crypto exchange to collaborate with traditional fin...
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