Binance is working with banking giant BBVA to enable its customers to hold assets off-exchange: report

The Block

2025-08-08 17:42:04

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Binance is working with BBVA to allow customers to hold their assets off-exchange, according to the Financial Times.

Spanish and Latin American bank BBVA has recently taken on a role as one of a few independent custodians for clients of the world's largest crypto exchange, the FT reported on Friday, citing two people familiar with the arrangement.

The move is reportedly designed to help reassure investors following Binance's record $4 billion fine by U.S. authorities in November 2023 for failing to prevent alleged money laundering, fraud, and sanctions violations. Crypto traders have been seeking to mitigate the risk of holding assets on crypto trading platforms in general following the FTX debacle in 2022, which left billions of dollars trapped in bankruptcy proceedings.

The BBVA custody setup keeps traders' funds in U.S. Treasuries at the bank, which Binance then accepts as trading margin, one of the people said, adding that the arrangement helps "mitigate a hypothetical FTX 2.0." It creates a barrier between trading and custody that is standard practice in traditional finance to reduce counterparty risk, but not common in crypto.

The collaboration may also signal a growing readiness among traditional lenders to strengthen ties with the crypto sector, boosted by the Trump administration’s strong backing of the industry in the U.S. and the rollout of MiCA regulations in the EU.

One source said the Spanish bank carries greater "name recognition" than Binance's current partners. "If you say BBVA, people are like 'box tick, next'," the person added, referring to the due diligence process when deciding whether to use the exchange.

In January 2024, Binance began letting its larger clients hold their assets at independent custodians like Sygnum and FlowBank to cut counterparty risk. Binance traders had previously been restricted to keeping their assets on the exchange or via Binance's custody partner Ceffu, which the Securities and Exchange Commission described as a "rebranded Binance entity."

BBVA has been expanding its crypto activity in recent months, announcing the rollout of bitcoin and ether trading and custody services in July. The bank has also advised its wealth clients to invest 3% to 7% of their portfolios in cryptocurrencies.

The Block reached out to Binance and BBVA for comment.

Crypto platforms are increasingly turning to off-exchange custody

However, Binance is not the only crypto platform looking at such off-exchange solutions, with Deribit, OKX, and Bitget also announcing similar plans in recent years.

In February, Deribit — set to be acquired by Coinbase — allowed BitGo and Copper clients to trade spot and derivatives on the exchange while their assets were secured off-exchange in qualified custody and automatically settled. The launch enables users to access Deribit's options and futures trading features without pre-funding their strategies.

In November 2024, OKX partnered with Komainu to provide an off-exchange custody solution for institutional clients. The previous year, Bitget had integrated Copper's ClearLoop network, offering off-exchange crypto trading to institutions.

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