Unbound Tech’s all-in-one security solution enables fast transaction signing and scalable, risk-based approval policies, and is being used by the likes of digital asset exchanges Liquid and Archax.
Unbound Tech, an encryption key management company backed by the likes of Goldman Sachs (GS:NYSE) and Citigroup (C:NYSE), has announced a major upgrade of its Crypto Asset Security Platform (CASP) which it says “directly answers the security and trust needs of large institutions wishing to adopt digital assets at the institutional level.”
A New Standard for Key Management
With the latest upgrade, CASP will leverage secure multi-party computation (SMPC) to protect private keys and transactions for all digital assets held by a custodian or exchange. The solution, also the first to receive U.S. Federal Information Processing Standard (FIPS) 140 Level 2 certifications from the National Institute for Standards and Technology (NIST), ensures data can be secured without revealing it to all parties.
With CASP, Unbound aims to demonstrate that the combination of multi-sig and Hardware Security Modules (HSMs) should not be the default solution for securing funds and encryption key security. Unbound’s alternative distributes “shares” of digital asset private keys across multiple approvers’ devices, ensuring no single point of failure and providing security akin to that of cold asset storage.
“Until today, there hasn’t really been a solution that directly answers the security and trust needs of large financial institutions wishing to adopt digital assets at the institutional level,” said Unbound Tech CEO Professor Yehuda Lindell in the press release.
As part of the upgrade, CASP benefits from features intended to improve security and usability. For example, users can now approve transactions even if they’re not online. A tamper-proof audit log, meanwhile, provides much-needed protection against internal user fraud unavailable via a standard HSM. Custodians can also configure authorization policies according to user or asset approval limits.
Data Theft Highlights Need for Improved Security
The importance of properly securing data is continually undermined by events in the cryptosphere, such as the recent shutdown of popular Chinese crypto exchange Fcoin, which Binance CEO Changpeng Zhao dubbed a Ponzi scheme. Numerous reports have indicated that Fcoin owes users $130 million in bitcoin.
Italian crypto exchange Altsbit, meanwhile, recently fell victim to a serious attack in which it lost almost all of its funds. While the amount in question was only around $70,000 – small change compared to the $500m lost by Coincheck in a 2018 hack – the incident highlights the urgent need for improvements in security and custody solutions.
According to Cointelegraph, security flaws caused crypto exchanges to lose $292 million in 2019 alone, and there is a long history of thefts from centralized exchanges and wallets dating back to Mt. Gox in 2014.
Solutions such as Unbound Tech’s CASP can eliminate the tradeoff between security and usability while meeting the needs of major custodians and exchanges that will always be prime targets for hackers. Better key management, coupled with regular disclosure of proof of reserves, are seen as instrumental in building trust in cryptocurrency exchanges.