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G4S, a multinational security firm, has jumped on the crypto-custodian bandwagon by offering to secure clients’ digital assets in a cold storage vault.
Have No Fear, G4S Is Here
The world’s largest security firm aspires to apply their expertise by safeguarding clients’ digital assets. Currently, the London-based multinational firm provides security for clients in over 90 countries. The firm is reported to already be offering clients a secure method to store digital currencies.
A recent statement from G4S explained that:
With the rise in the popularity and value of cryptocurrencies around the world in recent years, G4S has developed an innovative new service offering high-security offline storage that helps to protect assets from criminals and hackers.
Securing digital assets has been a persistent challenge to cryptocurrency investors, and a considerable obstacle standing in the way of institutional investors hoping to become more involved in the nascent sector. In fact, a report from Carbon Black Security found that $1.1 billion worth of cryptocurrency was stolen during the first 8-months of 2018 and Carbon Black security strategist Rick McElroy told CNBC, “It’s surprising just how easy it is without any tech skill to commit cybercrimes like ransomware.”
Most retail cryptocurrency investors store their assets in hot wallets on their personal computers, or even on cryptocurrency exchanges. Compared to hard wallets and cold storage options, these are easier targets for hackers as they are connected to the internet. Hard wallets and cold storage might not be the best option for institutional investors due to a variety of reasons. G4S believes that their storage option will remedy these concerns.
A Digital Vault with Layers within Layers
G4S has developed a unique method for storing digital assets. Hackers would encounter great difficulty in attempting to steal client assets. This is be cause GS4 uses a “specific” technology to secure digital assets.
Dominic MacIver, a senior risk analyst at G4S explained that their cold storage wallet system does more than just take the assets offline. The digital assets are also broken up “into fragments” that are then stored independently and have no value. These fragments are stored in “high-security vaults” that are not susceptible to attacks from hackers or armed robbers.
McIver also mentioned that access to the digital assets is not possible unless each fragment is combined using G4S’s proprietary technology. In addition to possessing impregnable cold storage vaults, G4S has “multiple layers of security” on site, and access to these sites is “heavily restricted.”
Crypto Custody: A Growing Field
G4S now joins a growing field of crypto-storage custodians as earlier this week Fidelity Investments rolled out Fidelity Digital Assets service and today Goldman Sachs and Mike Novogratz’ Galaxy Digital Ventures announced a $58.5 million dollar investment into BitGo.
If one considers Coinbase’s custody service, as well as Bakkt’s upcoming November launch, it becomes clear that companies anticipate a growing demand for cryptocurrency and digital asset storage services.
What do you think about G4S offering crypto cold storage services? Share your thoughts in the comments below!
Images courtesy of Bitcoinist archives, Shutterstock.
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