Binance, the top cryptocurrency exchange globally, revealed the introduction of Binance Mirror, an off-exchange settlement option for institutional investors. Binance Mirror will allow institutional investors to invest and trade utilizing cold custody.
Most cryptocurrency traders maintain their assets on the exchange, which puts them at risk when there is market volatility that causes significant platform outflows. With cold storage wallets, this risk is eliminated.
Key to protection for investors
The cryptocurrency market has been in a state of turmoil following the collapse of FTX, with centralized exchanges such as Binance experiencing a significant reduction in customer deposits due to the mounting uncertainty. In response to this, there has been a growing push for self-custody, as investors become increasingly concerned about the potential for more centralized exchanges (CEXs) to fold.
However, Binance is now offering a new product that aims to protect institutional investors from these risks. Binance Mirror is a cold storage solution that allows institutions to lock specified asset balances, which are then mirrored on their exchange accounts at a 1:1 balance. This means that, rather than posting collateral directly onto the Binance exchange, institutions can now use Binance Mirror to ensure that their assets are safe and secure.
The use of cold storage solutions like Binance Mirror is becoming increasingly popular in the crypto space, as they offer a higher level of security than traditional hot wallets.
Cold storage refers to the practice of keeping digital assets offline, on a device that is not connected to the internet, to protect them from hacking and other forms of online theft.
This new product from Binance provides a much-needed solution for institutional investors who are looking for a safe and secure way to store their assets in the crypto space. With the growing uncertainty surrounding centralized exchanges, Binance Mirror offers a way for institutions to protect their assets while still having access to them on the Binance exchange.
Binance Team stated that:
“As long as their Mirror position is open on the Binance Exchange, assets will remain secure in their segregated cold wallet, and can be settled at any time.”
VP of Binance Custody, Athena Yu also said:
“Institutional customers want the substantial liquidity that the Binance Exchange provides but security is their top priority. The finest of both worlds is brought together by Binance Mirror”
As a result, the introduction of Mirror presents the cryptocurrency company with a chance to roll out new features that will advance the functionality of cold storage.
Market perception for cryptocurrencies and Binance
Despite the difficult market circumstances brought on by a year-long bear market, more people visit Binance each month than any other exchange.
According to Coingecko data, Binance received 66.6 million monthly visits, compared to 35.4 and 15.6 million for Coinbase Global and ByBit, respectively. Furthermore, Binance has the greatest daily traded volume, which attracts institutional investors.
In the months that have passed after the collapse of FTX and Alameda, the cryptocurrency exchange has substantially contributed to the stabilization of the sector.
The creation of the appropriate trading tools, according to Changpeng Zhao (CZ), CEO of Binance, will aid in the mainstream market’s adoption of cryptocurrencies.
The repercussions from FTX have considerably helped the cryptocurrency market, which is dominated by the price of Bitcoin. The market value of all cryptocurrencies has increased by $1 trillion, with the price of Bitcoin (BTC) constantly hovering above $21k, according to our most recent crypto price oracles. With a price increase of nearly 44% over the previous seven days, the Solana ecosystem has seen the greatest increases recently.
Binance Mirror is a new product that offers a much-needed solution for institutional investors in the crypto space. The use of cold storage solutions is becoming increasingly popular, and Binance Mirror provides a safe and secure way for institutions to store their assets while still having access to them on the Binance exchange. With the growing uncertainty surrounding centralized exchanges, Binance Mirror is a valuable addition to the crypto market.