Singaporean DBS Financial institution’s Digital Trade (DDEx) CEO Lionel Lim stated that buyers search for regulated platforms as a substitute of looking for the choices that present one of the best yield, in accordance with Forkast Information.
Lim gave an interview to Forkast Information reporters the place he cited the devastating occasions of 2022 and the way they modified investor behaviors in the direction of looking for security. Lim acknowledged:
“The blind chase for yield is over. Traders at the moment are looking for secure harbors and like trusted, regulated platforms to entry the market.”
The DDEx recorded an 80% enhance in Bitcoin (BTC) buying and selling volumes and doubled the variety of its registered customers in 2022. Lim referred to those numbers and stated that ” DBS has been a beneficiary of this broader flight of security.”
In keeping with Lim, DDEx checks the purity of all cash coming into its custody and complies with all of the anti-money laundering (AML) and know-your-customer (KYC) guidelines obligatory for banks.
Mentioning the hostile results of the occasions of the 2022 bear market, Lim stated that he believed 2023 can be the yr for the digital asset business to rebuild belief and confidence. He argued that bank-backed exchanges like DDEx would play a significant function on this course of. Subsequently, although DDEx is trying to develop the providers it provides its clients, it prioritizes regulatory compliance and security product selection.
Segregation
Lim additionally identified that the DDEX doesn’t maintain any of its clients’ property beneath its custody. As a substitute, all of the property are saved in chilly wallets owned by the DBS financial institution, which provides an additional layer of security, in accordance with Lim.
Commenting additional on the subject of segregation, Lim acknowledged:
“Centralized exchanges will proceed to retain their reputation due to their relative ease of use, however we anticipate a shift in how centralized exchanges function and a transfer to undertake bank-grade infrastructure and danger administration.
One apparent low-hanging fruit is the clear segregation between custody and buying and selling property.
On Feb. 15, the U.S. Securities and Trade Fee (SEC) chair Gary Gensler voiced an identical opinion with regard to segregation. Gensler instructed increasing the federal custody necessities to incorporate crypto, which might mandate crypto exchanges to retailer their buyer’s property individually from the exchanges.