#Binance has partnered with Spanish banking giant BBVA (Banco Bilbao Vizcaya Argentaria) to allow clients to store assets off-exchange. This partnership marks a significant step towards addressing one of the main issues in the crypto industry — investor trust.
According to Financial Times data, BBVA has become one of the independent custodians for clients of the largest cryptocurrency exchange in the world. This decision aims to reassure investors after a record fine of $4 billion imposed by U.S. authorities on Binance in November 2023 for failing to prevent money laundering, fraud, and sanctions violations.
The lessons of FTX are not forgotten
The collapse of FTX in 2022 was a real shock for the crypto community — billions of dollars were locked in bankruptcy proceedings. Since then, traders have been actively seeking ways to reduce the risks of storing assets on cryptocurrency platforms.
The new scheme with BBVA works as follows: traders' funds are held in U.S. Treasury bonds at the bank, while Binance accepts them as trading margin. One source noted that this structure helps 'prevent a hypothetical FTX 2.0'. Separating trading operations and asset custody is standard practice in traditional finance to reduce counterparty risks, but it is still rare in the crypto industry.
The trend is gaining momentum
Binance is not the only crypto platform exploring such off-exchange solutions. Deribit, OKX, and Bitget have also announced similar plans in recent years.
In February, Deribit — which Coinbase plans to acquire — allowed clients of BitGo and Copper to trade spot and derivatives on the exchange, while their assets were protected off-exchange in a qualified custody with automated settlement. In November 2024, OKX partnered with Komainu to provide off-exchange custody solutions for institutional clients. A year earlier, Bitget integrated Copper's ClearLoop network, offering off-exchange cryptocurrency trading to institutions.
The partnership between Binance and BBVA demonstrates the evolution of the crypto industry towards greater transparency and security. Traditional financial institutions are gradually entering the crypto space, bringing with them tried-and-true risk management practices.
