The Bybit–Zodia Custody partnership enables off-venue settlement to allow traders to execute transactions without pre-funding their exchange accounts, reducing risk exposure

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Another important benefit of the recent update is the off-venue settlement. This implies that traders and investors do not have to pre-fund their Bybit trading accounts. Instead, their funds remain in custody until a trade is executed. This avenue cuts down exposure to exchange-related risks and improves capital efficiency.

This means users can trade on Bybit while their assets remain in Zodia's custody, thus reducing exposure to on-exchange risks and preventing co-mingling of funds.