Binance Partners with BBVA for Off-Exchange Crypto Custody

Binance has partnered with Spanish bank BBVA to allow clients to hold their crypto assets off-exchange, a move designed to boost investor confidence and reduce counterparty risk following Binance's record $4.3 billion fine in 2023 and the fallout from the 2022 FTX collapse. Under this arrangement, BBVA holds client funds in U.S. Treasuries, which Binance accepts as trading margin, effectively creating a separation between trading and custody modeled after traditional finance practices. The partnership reflects a growing trend of traditional banks entering the crypto space amid clearer U.S. and EU regulations and strong backing from the Trump administration. BBVA's established reputation adds credibility to Binance's custody solutions, making due diligence easier for clients. The bank has also encouraged its wealthier customers to allocate a portion of their portfolios to crypto, signaling its commitment to expanding crypto services. Binance had previously rolled out similar third-party custody options through other regulated custodians like Switzerland’s Sygnum and FlowBank earlier in 2024.