TABLE OF CONTENTS
Virtual Accounts are a custodial and off-chain abstraction of the blockchain, where assets are virtually traded across Virtual Accounts without blockchain fees.
How Virtual Accounts balance works
At a high level, the Virtual Account balance is the combination of two separate asset balance sources:
On-chain: Blockchain deposit addresses
Off-chain: Virtual Account trading
Depending on Virtual Account trading activity, a blockchain deposit address attached to a Virtual Account may hold a lower or higher balance than what’s available on its Virtual Account.
On-chain asset balance Management
Handing transfers from Virtual Accounts to blockchain addresses external to your Exchange or Application, successfully and pain-free, requires thoughtful On-chain balance management.
Trading across Virtual Accounts means that your On-chain balance increasingly spreads across the blockchain deposit addresses of your Exchange or Application. If left unchecked, your On-chain balance will become increasingly hard to track.
Virtual Accounts asset management can be handled in two ways:
Spread asset management
Centralized asset management
Spread asset Management - NOT recommended
You keep and maintain a complex database of all your Virtual Account balances and On-chain assets spread across all your blockchain deposit addresses.
At the time to handle transfers from Virtual Accounts to the blockchain, depending on the On-chain balance available within each individual deposit address of a specific Virtual Account, you may need to find additional deposit addresses within your database across your customers to amount enough On-chain balance to transfer out.
This method can require several blockchain transfers with different endpoint types.
Spread asset Management occasionally offers a low cost in fees. However, it requires from you a complex database and back-end infrastructure to handle On-chain assets and withdrawals. Find the related support article.
Centralized asset Management - Recommended
You keep a relatively simple database of all your Virtual Accounts and you track On-chain deposits.
After an incoming On-chain deposit from the blockchain to a deposit address of a Virtual Account, you transfer those On-chain assets to your Master Exchange address. Virtual Account withdrawals are handled via your Master Exchange Address.
Centralized asset Management has a higher cost in terms of fees. However, it requires from you a relatively easy database and back-end infrastructure to handle On-chain assets and withdrawals. Find the related support article.
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