Combining security, convenience, and seamless user experience has been one of the major dilemmas in the digital assets space. Since Bitcoin’s inception, a little more than ten years ago, startups all over the world have set out to solve this problem. Along the way, the industry has seen the loss of over $3 billion via hackers, poor private key management, and various Sybil attacks. And as the recent 18-month bear market concludes, the stakes will only get higher until this is resolved.
In the latest string of experiments, Fireblocks may have found a winning solution. The security firm announced today the launch of their proprietary “Hot Vault” as well as $16 million in support for their efforts.
Not a Wallet, Not Cold Storage
The security firm offers a much smoother interface that connects exchanges, OTC trading desks, personal accounts and everything in between.
Using Fireblocks’ software, interested parties could connect their Coinbase Pro accounts to a non-affiliated Ethereum wallet back to Bittrex exchange all through a single platform. With 15 digital exchanges supported in the software and over 180 cryptocurrencies, the combinations appear endless.
Add the above-mentioned interoperability to the equation, and Fireblocks appears to have ticked every buzzword in the crypto industry.
Such a multi-faceted blend has piqued the interest of investors by the likes of Cyberstarts, Tenaya Capital, and even Fidelity-backed EightRoads and MState. Along with bagging a cool $16 million, Fireblocks also boasts Galaxy Digital and Genesis Global Trading as trading operators.
Not only have they attracted investors, but also real users moving large crypto bags. This use has less to do with a slick interface, however, and much more to do with the real security backing what the Fireblocks’ team is calling a “hot vault.”
The platform removes the need for long strings of cryptographic addresses and instead secures transactions via Multi-Party Computation (MPC) technology. The use of MPC helps keep digital assets, no matter the platform, both readily available and highly-secure from fraudulent parties. This is part in parcel the reason for the term “hot vault;” a mix of cold storage hardware and hot wallet solutions.
As described in a demo with Fireblocks, users can quickly scroll through the various integrated exchanges, personal and professional accounts, as well as the near 200 different cryptocurrencies available to make transactions. The transaction is then approved or denied via a user’s smartphone before executing, much like 2-factor authentication.
Commenting on how this encryption technology bolsters the Fireblocks’ product, Gili Raanan of Sequoia Capital, said:
“Securing blockchain-based assets is one of the key challenges in modern cybersecurity warfare, and it requires heterogeneous expertise in mathematics, system level programming and years of hands-on cybersecurity experience.”
Before this announcement, institutions had been hesitant to join the crypto party. The reasons are myriad, but a notable barrier has been security. Just last month, the hack of premier crypto exchange Binance for $40 million shook the community to its core.
The CEO of the exchange, Chanpeng Zhao, has done well to recover since the debacle and explained at that time that the funds stolen were kept on a vulnerable hot wallet. But if one of the most trusted brands in the sector is susceptible to an attack of this gravity, what does that say about other, lesser exchange platforms?
Crypto has far to go in setting industry-wide standards in security, and with Fireblocks earning the attention of significant institutional players, one can be sure that there are many firms and businesses who could profit from an highly-secure and easy-to-use custodial service.
Original post link : https://btcmanager.com/fireblocks-announces-hot-vault-16-million-funding-fidelity-backed-firms/