According to a report by the Financial Times, Binance, the world’s largest cryptocurrency exchange, partners with banking giant BBVA to allow its users to keep their funds outside traditional exchanges. BBVA, a prominent banking institution based in Spain and Latin America, now acts as an independent custody provider for some Binance users. This partnership aims to boost trust following a $4 billion fine imposed on Binance in November 2023 and to mitigate counterparty risk concerns stemming from FTX’s bankruptcy in 2022.
BBVA Partnership: How the Independent Custody Model Works
One of the sources speaking to the Financial Times mentioned that within the BBVA custody model, users’ funds are held in U.S. Treasury bonds, which Binance accepts as collateral for transactions. This creates a distinct separation between transactions and custody, a common practice in traditional finance but rare in the crypto world. This separation helps mitigate potential platform risks and limits counterparty risk.
Sources emphasized that BBVA’s brand recognition can expedite decision-making processes, noting that “mentioning BBVA often checks a box on many companies’ compliance lists.” In January 2024, Binance granted its major users access to independent custodians like Sygnum and FlowBank, providing a similar option to reduce counterparty risk. Prior to this, the options included keeping funds on the exchange or using Ceffu, termed a “rebranded Binance entity” by the SEC, for custody.
Regulatory Climate and Industry Trends
Sources indicate that the approach of traditional banks towards the cryptocurrency sector has softened due to strong support from the Trump administration in the US and the progress of MiCA in the European Union. In July, BBVA announced services for buying, selling, and storing Bitcoin 
$66,111 and Ethereum 
$1,934 and provided high-net-worth clients with advisory services to allocate 3-7% of their portfolios to cryptocurrencies.
The concept of offering off-exchange custody solutions is not exclusive to Binance. In February, Deribit, BitGo, and Copper provided instant settlement access to spot and derivative trades while keeping user funds in qualified custody. In November 2024, OKX partnered with Komainu for institutional clients, and a year earlier, Bitget enabled off-exchange trading for institutions via Copper’s ClearLoop network. The general industry trend points to a system that separates transaction infrastructure from custody, distributing risks more evenly.
