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Tuesday, November 29, 2022

“Crypto playpen”: what security do platforms offer for users?

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William
William
I am a 24-year-old writer and journalist who has been working in the news industry for the past two years. I write primarily about market news, so if you're looking for insights into what's going on in the stock market or economic indicators, you've come to the right place. I also dabble in writing articles on lifestyle trends and pop culture news.
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Faced with a situation like this, experts warn that it is more convenient to deposit our investment in one of the platforms that can ensure greater liquidity, precisely to avoid being trapped in those corralitos, at least for an indefinite period of time.

Although there are some platforms that provide greater security, you are never completely risk free and the example is precisely FTX, the second largest exchange in the world only behind Binance, declaring bankruptcy and leaving more than 175 million dollars blocked.

How do the platforms offer security?

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It is important to understand how these platforms work and what options they offer to protect your investment. Coinbase offers private insurance that covers client wallets while protecting them against cyberattacks. Their bank accounts are insured by the Federal Deposit Insurance Corporation (FDIC).

For his part, Binance it protects investments using its Safe Asset Fund for Users (SAFU), which has been around since 2018. When the fund was established, Binance committed a percentage of trading fees to increase it to a substantial level to protect users.

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The Safe Asset Fund was valued at US$1 billion based on the opening price on January 29, 2022. The value of the fund will fluctuate with the market. SAFU fund portfolios comprise BNB, BUSD, and BTC.

Banks offer to take care of cryptocurrencies

A paradigmatic example that was released in the last few hours was Banco Itaú, one of the largest in Brazil, which announced that it will offer cryptocurrency custody services in 2023.

As of the second quarter of 2023, the company will offer custody of crypto assets. Initially it will only be for the bank’s digital assets. In a second instance, it will be available to third parties in the “as a service” infrastructure format, for corporate and institutional clients.

The business unit responsible for leading the way will be Itaú Digital Assetsdedicated to the infrastructure and tokenization of the bank’s crypto assets. Jose Augusto Antunes will be at the head of the operation, who will replace Vanessa Fernandeswho was in charge of the area from New York.

“Custody is a fundamental element in this context, because, especially in a new market such as crypto assets, it provides security for investors. We safeguard client assets in a trusted environment.”

BTG Pactualanother institution in Brazil, debuted its cryptocurrency custody services in August as part of the launch of its own cryptocurrency exchange, called Mynt.

Source: Ambito

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