PANews reported on June 27 that Binance is patching a loophole in a plan that allows prime brokers on the platform to earn extra income at the expense of Binance, according to Bloomberg. Binance will make changes to Link Plus starting July 1 to limit prime brokers from gaining improper benefits by managing institutional client accounts. This move may harm the income of some brokers, but Binance emphasizes the importance of user compliance and fair competition.
According to people familiar with the matter, the Link Plus system allowed prime brokers to provide improper fee rebates to clients and earn additional revenue through Binance's 9-tier fee structure. VIP customers complained that the system provided brokers with an unfair advantage. According to Binance's website, its highest "VIP 9" level offers extremely low fees to users with at least $4 billion in monthly trading volume. Prime brokers reach this level by "bundling" accounts, but the new changes will directly bind customers to the tier corresponding to their actual trading volume, eliminating the ability to bundle, which may cause some brokers to lose their top status.
Malta-based crypto trading firm Bequant is turning to proprietary trading because its main business revolves around arbitrage of Binance fee tiers. In addition, Binance also announced that it will restrict the abuse of account functions to ensure platform fairness, but this move is not directly related to the Link Plus reform.
