Cryptocurrency

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 <p class="paragraph">Binance, the worldwide blockchain ecosystem that is responsible for the biggest cryptocurrency exchange in terms of trading volume, successfully implemented the world’s first cryptocurrency triparty agreement with a third-party banking partner on November 30, 2023.&nbsp;</p>
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 <p class="paragraph">The implementation of this solution makes it possible for institutional investors to store trade collateral in the custody of a third-party banking partner, away from the exchange, according to the latest information shared with Finbold.</p>
 <p class="paragraph">This is the first in a series of pilot projects initiated by Binance, which is currently the only cryptocurrency exchange offering such a solution.</p>
 <p class="paragraph">The company’s aim is to directly tackle the <a rel="noopener noreferrer nofollow" title="counterparty" href="https://thebittimes.com/tag/counterparty.html">counterparty</a> risk issue, alleviating one of the main concerns among many institutional <a rel="noopener noreferrer nofollow" title="investors" href="https://thebittimes.com/tag/investors.html">investors</a>.</p>
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  <p class="paragraph">“Counterparty risk has long been a concern of institutional <a rel="noopener noreferrer nofollow" title="investors" href="https://thebittimes.com/tag/investors.html">investors</a> across the industry. Our team, of crypto natives and traditional finance professionals, has been exploring a banking <a rel="noopener noreferrer nofollow" title="triparty" href="https://thebittimes.com/tag/triparty.html">triparty</a> <a rel="noopener noreferrer nofollow" title="agreement" href="https://thebittimes.com/tag/agreement.html">agreement</a> for more than a year to address their concern.”</p> <cite>said Catherine Chen, Head of VIP and Institutional at Binance</cite>
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 <p class="paragraph">“We’ve developed a solution that ensures our institutional clients can optimize their collateral and cryptocurrency investments, modeled after the traditional markets’ trading conduct”, added Chen.&nbsp;</p>
 <h2 class="wp-block-heading" id="h-banking-partners-and-institutional-investors-are-interested"><strong>Banking partners and institutional investors are interested</strong></h2>
 <p class="paragraph">The developed solution by Binance emulates a structure commonly found in conventional financial markets, allowing <a rel="noopener noreferrer nofollow" title="investors" href="https://thebittimes.com/tag/investors.html">investors</a> to adjust their allocation of crypto assets based on their risk tolerance.&nbsp;</p>
 <p class="paragraph">However, collateral held with the banking partner can be in the form of fiat equivalent such as Treasury Bills, which has the added benefit of being a yielding asset.</p>
 <p class="paragraph">The solution seems to be positively accepted by the financial community, and Binance is in “discussions with an array of banking partners and institutional <a rel="noopener noreferrer nofollow" title="investors" href="https://thebittimes.com/tag/investors.html">investors</a> who have also expressed strong interest in participating”, Chan stated.<em>&nbsp;</em></p>
 <p class="paragraph">All in all, the positive reception and ongoing discussions with potential banking partners and institutional investors signify a promising trajectory for the adoption of this pioneering approach.</p>
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<p>Source: <a rel="noopener noreferrer nofollow" target="_blank" href="https://thebittimes.com/binance-trials-triparty-agreement-to-reduce-counterparty-risk-for-investors-tbt72222.html">https://thebittimes.com/binance-trials-triparty-agreement-to-reduce-counterparty-risk-for-investors-tbt72222.html</a></p>

Binance trials triparty agreement to reduce counterparty risk for investors

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