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Arwen, a Boston-based distributed ledger technology (DLT) company has teamed up with KuCoin to launch its namesake protocol Arwen, which is aimed at protecting cryptocurrency traders’ digital assets from hacks on centralised exchanges, according to a Medium blog post on January 28, 2019.
Arwen Protocol will Allow Hodlers Trade Securely on Centralized Exchanges
At a time when hacks and heists have become quite synonymous with cryptocurrency exchanges and trading venues, Arwen has launched the Arwen protocol to safeguard the hard-earned funds of users’ of centralised exchanges when there is a security breach.
Interestingly, Bitcoin security expert, Hartej Sawhney recently revealed that nearly $2.5 million is stolen on centralized exchanges on a daily basis.
Per the experts, exchanges are prime targets for bad actors because most trading venues store a significant amount of traders' digital assets on hot wallets, to make it easier for clients to withdraw funds in real-time.
Now, Arwen is ready to make crypto heists a thing of the past with the launch of the innovative Arwen protocol and allow exchanges to focus on how to offer clients better experience and liquidity.
Commenting on the development, CEO of Arwen, Sharon Goldberg reiterated that while centralized cryptocurrency trading platforms and exchanges provide users with excellent liquidity, most of them are yet to build robust security systems powerful enough to prevent loss of funds via hacks.
In his words:
“Centralized exchanges are valuable pools of liquidity for traders. The problem is that trading on centralised exchanges without an advanced security system is highly risky for traders. If an exchange is compromised during a trade, customer funds are at risk. With Arwen, customer funds remain secure even if an exchange is hacked.”
Arwen is Powered by Blockchain Technology
Per the team, while other market solutions for custody rely on third party products and services to manage customer coins and decentralized exchanges (DEXs) on the other hand, present users with better security and less liquidity, Arwen is designed to enable users enjoy the advantages of centralized exchanges and DEXs without having to bother about their limitations.
Reportedly, Arwen provides users with a non-custodial, trustless solution that supports cross-chain atomic swaps.
In essence, “Instead of relying on third-parties to store and protect your coins, Arwen uses the blockchain itself as its escrow agent, enabling trades on centralised exchanges to execute in a truly trustless manner.”
KuCoin President and Co-Founder, Eric Don also noted that while the exchange has been hard at work trying to make its platform as secure as possible, the collaboration with Arwen is a forward-thinking manoeuvre, as Arwen’s DLT-based escrow system
“enables users who have extreme security requirements to have a higher sense of security in their transactions.”
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