 | Get all the essential market news and expert opinions in one place with our daily newsletter. Receive a comprehensive recap of the day's top stories directly to your inbox. Sign up here! |
(Kitco News) - Binance, the largest cryptocurrency exchange in the world, is looking to woo the institutional crowd as they slowly enter the digital asset space with the launch of Capital Connect, a free platform for VIP-level users of the exchange that facilitates connections between investors and investment managers.
Capital Connect was designed to “address the pain points of information disclosure and networking inefficiencies that institutional investors and fund managers face today,” Binance said. The new platform achieves this “by helping to create information standards and reduce inefficiencies through a unified platform.”
All eligible Binance VIP clients that live in approved regions are eligible to apply as investors on Capital Connect, and investment managers who complete Binance’s know-your-business (KYB) verification process can also access the service.
“As an Investor, you can browse different funds and diversify your portfolio allocations,” Binance wrote. “Investors will be able to choose Investment Managers based on strategies, redemption terms, fees, AUM, and Sharpe Ratios. As an Investment Manager, you can increase the awareness of your funds and develop new clients.”
It’s important to note that while Binance will require investment managers to complete KYB, the exchange will not filter or select investment managers or investors and will not be involved in any of their discussions.
As part of its due diligence practices and to give investors insight into a fund's past performance, Binance has put requirements in place for listed investment managers to provide records of monthly returns that are verified by reputable fund administrators.
All participants on the platform are able to remain anonymous until a connection with an advisor has been completed, and only investors can initiate connection requests with investment managers. Managers can then analyze the investors’ profiles and determine whether to accept them as a client.
|
| Bitcoin loses over 2% after Binance halts withdrawals twice, moves $4.4 billion BTC |
Interested parties can apply for access as an investor or investment manager with Binance, and both roles are only available to Biancne VIP-level users who have completed the verification process. Becoming a VIP-level investor requires an initial minimum deposit balance of $100,000.
This development from Binance shows that the expansion efforts of the exchange have been undeterred by the increase in regulator scrutiny of the exchange, particularly in the U.S. In March, the Commodity Futures Trading Commission sued Binance and its CEO Changpeng Zhao (CZ) for allegedly breaking trading and derivatives rules and for not properly registering with the regulator.
Binance has also faced legal challenges in regard to its stablecoin, Binance USD (BUSD). In February, the Securities and Exchange Commission ordered Paxos, the company responsible for issuing BUSD, to stop issuing the token. Since that time, the market cap of BUSD has declined from a high of $16.4 billion to $5.78 billion but remains the third leading stablecoin by market cap.
