Binance Partners with BBVA for Off-Exchange Custody to Secure User Assets

Generated by AI AgentCoin World
Friday, Aug 8, 2025 5:16 am ET1min read
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Aime RobotAime Summary

- Binance partners with BBVA to offer off-exchange custody, allowing users to deposit assets in U.S. Treasuries as trading collateral.

- The model separates trading from asset backing, reducing counterparty risk and protecting clients from exchange failures.

- Binance shifts from internal fund storage to third-party custodians, reflecting post-FTX industry efforts to enhance crypto security and transparency.

- BBVA expands crypto services, advising clients to allocate up to 7% of portfolios to Bitcoin and Ethereum through its mobile app.

Binance has partnered with

BBVA
, Spain’s third-largest bank, to offer off-exchange custody services to its customers, according to reports. The arrangement enables traders to deposit their assets in U.S. Treasuries held by BBVA, which Binance accepts as margin for trading activities. This move aims to reduce counterparty risk and protect clients from potential losses due to exchange failure [1]. The Financial Times cited sources familiar with the process, noting that this custody model separates trading from the funds backing transactions, ensuring that user assets remain secure even if Binance encounters operational or financial issues [1].

The partnership represents a shift for Binance, which previously held user funds internally. This new approach reflects broader industry efforts to enhance transparency and security in crypto asset management. These changes have gained urgency following the collapse of FTX in 2022, which exposed vulnerabilities in how exchanges handle customer funds [1]. In response, many exchanges have introduced measures like proof-of-reserves to demonstrate that user assets are held in their wallets.

Binance has previously allowed clients to use third-party custodians, including Sygnum and FlowBank. The company also settled a $4.3 billion penalty with U.S. regulators last year for anti-money laundering failures, reinforcing its ongoing efforts to align with stricter regulatory expectations [1].

BBVA has been expanding its presence in the cryptocurrency sector. This year, it launched crypto trading and custody services through its mobile app and advised private clients to consider allocating up to 7% of their portfolios into

Bitcoin
and
Ethereum
[1]. These developments indicate the bank’s strategic interest in digital assets and its commitment to supporting institutional and retail clients in the crypto space.

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Source: [1] Spanish Bank BBVA Said to Offer Off-Exchange Custody to Binance Customers: FT (https://www.coindesk.com/business/2025/08/08/spanish-bank-bbva-said-to-offer-off-exchange-custody-to-binance-customers-ft)