Bybit, one of the world’s top three crypto exchanges by volume, today announced that it is leveraging Fireblocks, an enterprise platform to manage digital asset operations and build innovative businesses on the blockchain, and integrating its Off Exchange solution to mitigate counterpartycounteparty risk for institutional trades.
Off Exchange is an innovative solution which empowers institutional traders to trade on centralized exchanges from an on-chain multiparty computation (MPC) shared wallet, mitigating exchange counterparty risk. In the last 90 days, the Fireblocks Network, upon which Off Exchange was deployed, facilitated over $200 billion in transactions between institutional traders and over 30 connected exchanges.
Off Exchange leverages MPC technology to enable traders to allocate and mirror assets directly to an exchange from a wallet they mutually control, protecting their principal from counterparty risk, such as hacks, bankruptcy and fraud, while providing centralized exchanges with complete on-chain transparency that client accounts are fully collateralized. By utilizing Off Exchange, Bybit is taking a proactive step towards bolstering security protocols and meeting the evolving needs of institutional traders.
Key benefits of Fireblocks Off Exchange for institutional clients, include:
- Enhanced asset protection and security: The comprehensive MPC wallets utilized by Fireblocks Off Exchange programmatically lock and mirror assets to the connected exchange. By locking funds in the collateral vault accounts (CVAs), traders reduce the risk of unauthorized access or loss of assets, providing an additional layer of protection.
- Real-time settlement and transparency: The blockchain-native Fireblocks Off Exchange system enables real-time and on-chain settlement. This means that transactions and asset movements are recorded on the blockchain, providing transparency and traceability for both Bybit and institutional clients, without taking custody of client assets.
- Flexibility and control: Institutional traders can withdraw assets to other venues or wallets once the CVA is rebalanced, giving them more control and the option to choose the most suitable storage or trading options.
- Increased liquidity and efficiency: The system enhances liquidity by optimizing capital allocation and facilitating faster and more efficient trading activities. This benefits both the clients and the exchange by enabling them to make better use of their resources and participate in a more liquid market environment.
Eugene Cheung, Head of Institutions at Bybit, said: “At Bybit, we are committed to fostering trust in the crypto industry and enhancing the security of institutional trades. The integration of Fireblocks Off Exchange offers enhanced on-chain transparency and a reliable trading environment, reinforcing trust and confidence for our customers. By leveraging Fireblocks, we underscore our unwavering commitment to institutional asset safety, which has always been a top priority for us. ”
Richard Astle, VP Business Development, Fireblocks Network, added: “Fireblocks has always taken an innovative, technology-first approach to solving some of the most pressing challenges in the digital assets industry. By using the Fireblocks Network, an institutional-grade digital asset transfer platform for rapid digital asset transactions and dynamic payment workflows, businesses gain direct connectivity to over 1,800 liquidity partners, trading venues, and counterparties and can streamline their trading operations with Network applications such as Off Exchange.”
“We work with different partners to ensure client security and operational efficiency,” added Cheung. “Along with the newly launched Asset Management Account, Bybit provides a best-in-class trading experience for our institutional clients.”