In an effort to gain more trust from financial institutions, Binance has just launched Binance Mirror, a new service.
According to an announcement from the crypto exchange, Binance declared that Binance Mirror will be available on Binance Custody, the company’s crypto custody offering which is regulated by institutions.
The press release states that Binance Mirror represents a settlement service working off the exchange, which is meant to enable institutions to invest in and trade products in the ecosystem of Binance via cold custody.
Following FTX going under, the crypto industry remained in a state of limbo and Binance alongside other centralised exchanges, observed that customer deposits started to drop as uncertainty grew. Due to fears of CEXs going bust, many people pushed to gain self-custody. Hence the latest service from Binance, which comes with hopes from the company that institutional investors will be protected.
The new solution works by having institutions locking lock asset balances which are mirrored on the accounts they have with the exchange, at a 1:1 ratio. This represents an alternative for collateral posted straight on Binance. The crypto exchange stated that these assets remain separate in the cold wallet for the same period that the Mirror assets are present on Binance.