Malta-based cryptocurrency trading platform Binance has launched a cloud operation to help business clients and partners set up their crypto exchanges using Binance’s tech infrastructure. The service includes matching engines, risk controls, and data security systems.
As one of the world’s largest cryptocurrency trading platforms, Binance has decided to venture into the cloud business like tech giants Amazon and Alphabet have done in the past: by evolving beyond their core consumer-facing services and become some of the world’s biggest cloud providers.
Binance Cloud will overtake the company’s main exchange to become its biggest source of revenue in five years, according to co-founder and CEO “CZ” Zhao Changpeng.
“Theoretically speaking, we can let anyone in the world create their own exchanges, and the demand is huge- Even during the crypto winter of 2018 and 2019, hundreds of new exchanges popped up every day. Liquidity is a chicken-and-egg problem for small exchanges. Without liquidity, they won’t have users.”
The cloud division is part of Binance’s strategy to attract fiat money. The exchange currently makes money mostly via transaction fees on its trading platforms. The enterprise-oriented businesses should add a new and steady revenue stream.
Huobi, another leading cryptocurrency trading platform, has rolled out its cloud operation in 2018 already ushers clients such as Russia’s VEB Bank and Taiwan’s Chi Fu Group.
In February 2020, Binance made a new addition to its senior-level executive committee by onboarding Iskander Malikov to serve as its new Director for Fiat division for Europe and CIS (Commonwealth of Independent States) market regions. He is now responsible for establishing new fiat to crypto channels and gateways across the market region he is in charge of.
Binance has recently acquired crypto-asset trading platform JEX, a specialist in spot and derivatives trading services which focuses os on further building the cryptoasset derivatives market, in order to offer Binance users with professional services including futures contracts, options, and other derivative products.
In 2019, Binance managed to recruit Catherine Coley, a senior executive from Ripple who was serving as head of the firm’s institutional liquidity. Coley joined Binance’s newly opened US arm as its Chief Executive Officer. The US operation targets American traders.
Also that year, Binance partnered with leading payment processing company Simplex to allow users to buy cryptocurrencies with their credit cards directly on its official domain. The new feature of accepting credit card payments for crypto is another step to support the broader use and accessibility of cryptocurrency worldwide.