The new service is based on Binance Custody which happens to be a regulated institutional digital asset custodian.
The FTX crisis has put even more heat on centralized crypto exchanges, and cold wallets have all the focus now. It is only natural for the world’s largest crypto exchange to allow institutional players to keep their crypto in cold storage solution.
Binance announced a new service, dubbed ‘Binance Mirror,’ an off-exchange settlement solution that enables institutional investors to access trading and investment products within the exchange ecosystem without having to post collateral directly on it.
Binance’s New Feature
According to the official press release, institutions can lock a specific amount of their asset balance in Binance Custody’s cold storage facility and mirror it onto their exchange account with a 1:1 balance. The platform highlighted that user assets remain secure in their segregated cold wallet for “as long as their Mirror position remains open on the exchange, which can be settled at any time.”
The move will essentially enable investors to continue trading even during volatile sessions without getting hit by massive outflows on an exchange.
Following the announcement, Athena Yu, VP of Binance Custody, said,
“Security is a top priority for institutions, who also desire the deep liquidity that the Binance Exchange offers. Binance Mirror brings the best of both worlds. We spent much of last year refining its operations to help our clients unlock the liquidity of their assets held in our cold storage. We’re very excited about where we are today and can’t wait to introduce our upcoming new features that will elevate Binance Mirror’s functionality even further.”
Binance’s Roadmap for 2023
The dramatic collapse of Binance’s rival crypto exchange, FTX, in November last year marked turbulent times and extended crypto winter. Concerns about centralized exchanges’ ability to maintain user funds have intensified. Several crypto firms resorted to publishing proof-of-reserve reports to alleviate the fears. However, many announced layoffs while others have halted hiring.
Binance, on the other hand, plans on expanding its headcount by up to 30% this year. The CZ-led platform also scored registration to operate as a financial institution for management and trading in virtual currency from Swedish Financial Supervisory Authority. With this, Sweden became the seventh EU jurisdiction to greenlight Binance.