Virtual Account - Balance Management and Withdrawals

Modified on Wed, 10 May 2023 at 12:49 PM

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


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.


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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