The growing demand for secure, compliant infrastructure in the digital asset space has prompted global cryptocurrency exchange Bybit to form a strategic partnership with Sygnum Bank, a regulated Swiss digital asset institution. This collaboration aims to significantly enhance Bybit’s institutional offerings by integrating advanced custody solutions.
Central to this alliance is the integration of Bybit’s trading services with Sygnum Protect, an over-the-counter (OTC) custody system. This innovative setup allows institutional traders to securely store their digital assets with Sygnum while maintaining access to Bybit’s deep liquidity across spot and derivatives markets. The system ensures real-time balance updates and automatic daily settlement, effectively separating asset custody from active trading. This model mitigates counterparty risk, a crucial concern for institutions, especially after past market events exposed vulnerabilities in direct exchange holdings.
Sygnum Protect boasts the world’s largest bank-backed custody network, supporting platforms that process over half of global crypto trading volumes. Bybit joins leading exchanges like Binance and Deribit in this network, underscoring its commitment to robust security. Crucially, assets custodied under Swiss law receive bankruptcy protection, offering a vital layer of assurance. This move aligns with Bybit’s broader strategy of cultivating diverse custody partnerships, including those with Fireblocks, Copper, and Cactus, to achieve comprehensive risk management and bank-grade compliance.
The partnership directly addresses the industry’s need to balance high liquidity with stringent risk management. Yoji Wang, head of Bybit’s B2B division, emphasized that this alliance fulfills institutional requirements for compliant and secure trading environments. Sygnum Bank notes a considerable rise in demand for regulated custody solutions, mirroring the steady influx of institutional capital into digital assets. This strategic convergence of a major exchange and a regulated bank signifies the ongoing maturation of the cryptocurrency market, solidifying the foundation for broader institutional engagement.
Michael combines data-driven research with real-time market insights to deliver concise crypto and bitcoin analysis. He’s passionate about uncovering on-chain trends and helping readers make informed decisions.