Binance, the cryptocurrency exchange company, has announced the launch of a crypto asset store dubbed ‘Binance Mirror’ as investors return to the industry. The global crypto market capitalization has shown a significant recovery in the first three weeks of 2023, moving from $800 billion (approximately Rs. 65,45,524 crore) to its current valuation of $990 billion (approximately Rs. 80,97,818 crore) . With ‘Binance Mirror’, which specifically targets institutional investors, the company will provide an off-exchange cold crypto storage solution to hefty investors so that their fear of losing their finances to hacks or liquidity crises can be reduced as much as possible.
Binance is taking a bullish approach to shifting the focus of its services to cold storage of crypto assets. Cold storages or wallets are not connected to the internet and do not depend on the databases of exchanges.
“Through Binance Mirror, institutions lock a certain amount of their asset balance available in their Qualified Wallet, Binance Custody’s cold storage solution, and mirror it to their Binance Exchange account with a 1:1 balance. Their assets will remain safe in their segregated cold wallet as long as their Mirror position remains open on the Binance Exchange, which can be settled at any time,” the exchange said in an official statement.
Last year, the FTX crypto exchange crashed dramatically after a liquidity crisis. Other crypto companies like Celsius and Voyager also pulled curtains on their businesses after being hit hard by the ongoing crypto winter.
Several hackers and scammers have also targeted crypto exchanges to drain funds. Citing a Chainalysis report, UKTN said that more than $3 billion (approximately Rs. 31,076 crore) was stolen in 125 hacks last year. Amidst these circumstances, more people have begun to move the custody of their crypto holdings to cold stores.
In a recent report, Glassnode had noted that about 5,50,000 Bitcoins worth $9.2 billion (approximately Rs. 76,760 crore) had been moved to cold storages last year.
“Security is a top priority for institutions. We spent much of the past year fine-tuning operations to help our clients unlock the liquidity of their assets in our cold storage,” said Athena Yu, VP of Binance Custody.
Binance has secured operating licenses in various parts of the world. Currently, it has permission to operate in seven member states of the European Union, as well as parts of the UAE. The exchange expects to onboard institutional investors from all of these regions