Anchorage Digital has integrated with Binance and launched an off-exchange settlement service for institutional clients.

Cointelegraph reported on Tuesday that institutional clients can trade on Binance without directly depositing cryptocurrency and cash on the exchange, and instead hold them in an Anchorage qualified custody account at the U.S. federally chartered crypto bank.

Institutional clients can use crypto assets held at Anchorage or U.S. dollar deposits as collateral to meet Binance margin requirements. They do not need to move assets to the exchange first. The assets remain with an independent custodian until settlement.

The integration focuses on reducing exchange counterparty risk, a key factor that has blocked institutional funds from entering the crypto market. Cointelegraph said it removes the structure that required assets to be deposited in advance of trading, bringing the model closer to the separation of custody and execution in traditional financial markets.

Similar structures are spreading in the institutional crypto trading market this year. BitMEX partnered with Zodia Custody in April to allow institutional clients to trade derivatives while keeping collateral in segregated custody accounts. Bitget also integrated with Fireblocks Off Exchange in June to support trading while keeping assets in trader-controlled collateral vaults. KuCoin Institutional also integrated the Cefu MirrorX platform in January to set up a system that trades under third-party custody and settles off-chain every 4 hours.