Binance, the world’s largest cryptocurrency exchange, has formed a strategic alliance with Spain’s leading banking group BBVA to allow customers to store their digital assets outside the Binance platform. This new custody solution enables clients to hold their crypto holdings independently with BBVA, rather than directly on Binance, improving asset security and lowering risks related to centralized exchanges.
In this partnership, BBVA serves as an independent custodian, protecting client assets—which are often held in U.S. Treasury securities—that Binance accepts as collateral for trades. This separation of custody from trading functions aims to shield investors from potential losses associated with exchange insolvencies or mismanagement, a concern heightened by the collapse of the FTX exchange in 2022.
The collaboration highlights a significant step by traditional financial institutions to integrate with the cryptocurrency sector, backed by emerging regulations in the U.S. and Europe that clarify custody and compliance protocols. BBVA has also expanded its crypto services in Spain, including retail trading of Bitcoin and Ether through its mobile application, reflecting growing institutional confidence in digital assets.
Through this off-exchange custody approach, Binance seeks to restore investor trust following regulatory scrutiny, including a $4.3 billion penalty in the U.S. for compliance violations and legal issues involving its CEO. The alliance with BBVA is part of a wider industry trend where crypto exchanges partner with regulated banks to enhance transparency and safeguard funds.
This cooperation is expected to reassure investors by combining financial institution-level regulatory protections with Binance’s exchange platform, potentially encouraging broader acceptance and participation in the cryptocurrency market.
