The Binance, currently the 4th largest cryptocurrency exchange by daily trading volume, has announced the acquisition of a mobile digital wallets provider “Trust Wallet”.
Binance will add Trust Wallet to its services as a subsidiary company. It will preserve autonomy and ability to further develop its application at the same time benefiting from access to Binance wide client base and decentralized exchange (DEX).
Trust Wallet is an open source platform compatible with ethereum tokens, which also includes DEX functions and allows to store more than 20,000 tokens based on the Ethereum network anonymously. Their future plans include working with the other blockchain platforms as well. According to the founder of Trust Wallet, Victor Radchenko, his project was originally created as infrastructure that helps other developers create DEX-applications.
Binance CEO Changpeng Zhao commented on the acquisition saying that cryptocurrency wallets are the base of the crypto economy, and safe and easy-to-use wallets can greatly facilitate the dissemination and recognition of cryptocurrency.
The value and details of the deal were not disclosed, but Zhao said that the evaluation of the firm was modest because of the narrow customer base. He also added that Binance intends to acquire several more companies and is already negotiating with some of them.
WHY IS IT IMPORTANT?
Before the acquisition, Binance did not have a decentralized wallet working with the exchange. Customers had to trust the company’s inner resources. Cryptocurrency exchanges are favorite targets for сyber attacks. Recently Bithumb, one of the largest crypto platforms in Asia, was hacked and lost $31 million in crypto. Another exchange, Conrail, suffered from a heist worth $37 million in tokens. But the biggest loser this year was Coinchech, with the crypto loss equal to $400 million.
Decentralized wallet will allow customers to store cryptocurrencies directly using their own "private keys". Although many Binance customers have already transferred their funds to an external wallet, the acquisition gives Binance its own wallet brand and hope for better security.