By CCN Markets: In the wake of high-profile hacks such as the $44 million recently removed from Binance’s coffers, BitGo CEO Mike Belshe spoke at Coindesk’s Consensus 2019 on matters including security and how this is hindering the will of institutions to involve themselves in Bitcoin and other digital assets.
He told an audience at the event that “we are bringing to market a risk-less, efficient and compliant digital asset clearing and settlement” in a move that sees the security and custody solutions company stake a claim for institutional investors by moving crypto transfers off-chain.
If a custodian settles a cryptocurrency trade on-chain, it means that users’ assets are temporarily placed into hot storage which in the process exposes them to risks of hacks or counterparty default. A level of risk that institutions are unlikely to countenance.
Belshe was not the only one pitching custody services at Consensus, with Onchain and Ledger in Manhattan to establish themselves as the best place for institutional money.
Their target will be investors wary of security risks demonstrated in recent hacks that have seen the theft of millions of dollars worth of crypto.
Another desirable section of the market lies in crypto hedge funds with serious ground to make up following the 2018 market collapse. If that was a Crypto Winter then some bulls hope this year will be Spring, an outcome which may result in new money flowing into digital assets. A result of this is likely to be seen in a rising demand for reliable custodians.
Who Can Be Trusted?
Public trust in centralized exchanges is affected by the fact that 2018 was the worst year ever for these types of thefts. Last month, New Zealand-based Cryptopia issued a desperate plea for users to stop deposits, after announcing on May 15 that it had gone bust following a failure to recover…