Bitfinex, the digital assets exchange, has announced a strategic partnership with Zodia Custody on Thursday. This collaboration aims to facilitate seamless trading for institutional clients on Bitfinex while their assets are securely safeguarded through Zodia's off-exchange settlement solution, Interchange.
This integration allows institutional clients who maintain accounts with both entities to replicate their custodial assets on Bitfinex for trading without the need for actual transfers. The settlement resulting from these trading activities will occur periodically on the blockchain, thereby promoting efficient platform interaction.
The partnership is part of Bitfinex’s ongoing efforts to separate trading and custodial functions, a move aimed at enhancing security and strengthening the overall market structure. This approach follows the trend of crypto exchanges looking to increase security by separating custody from trading, a practice that has become increasingly relevant following the collapse of FTX last November.
Bitfinex's collaboration with Zodia Custody, a UK-licensed entity owned by multinational bank Standard Chartered (OTC:SCBFF) (STAN), is a testament to its commitment to work with reputable custodians. This follows previous partnerships with esteemed custodial partners like Koine in 2020 and Digivault in 2022.
Paolo Ardoino, CTO of Bitfinex, emphasized the company's commitment to shaping the future of digital market infrastructure. "Working with Zodia Custody is a significant part of that strategy, and together we can look to enable even more institutions to enter or further participate in digital assets," Ardoino said.
Julian Sawyer of Zodia Custody described their product Interchange as an absolute necessity for digital assets investors. "Interchange has been designed from the ground up to provide a better, more robust, approach to custody when trading through exchanges — this is custody, without compromise… This isn’t a ‘nice to have’ but an absolute requirement," Sawyer added.
Earlier this month, Zodia Custody expanded its services to Singapore, providing digital asset custody services for financial institutions in the Asian country.
The partnership comes as a significant development for Bitfinex, which was subject to one of the most infamous hacks in the history of crypto, with 120,000 BTC (worth over $3 billion in today's prices) stolen in 2016.
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