Published Aug 7, 2019 12:36:37 PM
Despite the blockchain promising to eliminate trust, cryptocurrency is still plagued by reliance on third parties.
All too often, exchanges and trading platforms take control of user’s cryptocurrency by storing the private keys in their own wallets, and inadvertently creating a perfect target for hackers, who are estimated to have stolen $1.7 billion in cryptocurrency in 2018 alone.
Those that choose to retain control of their keys face similar challenges, and around 3 million bitcoins are thought to be lost forever due to mistakes made by enthusiasts trying to be their own bank.
In response to this, Qredo offers a decentralized vision of crypto custody—bringing the security and transparency of the blockchain to private key storage, and—in an ironic twist—replacing the risky centralized storage methods that have been preventing institutions from investing in the space. This has several benefits to custodians:
Instead of storing private keys in costly infrastructure, Qredo uses clever key distribution so that private keys controlling the digital assets do not physically exist the entire time the digital assets are in custody, making them impossible to steal.
In the worst case scenario—force majeure events or unavoidable catastrophes—custodians can rely on USB keys that allow the recovery of assets within a custodial account.
Unlike cold storage or multisig services, Qredo quickly grants control over custodial accounts as soon as cryptographic redemption conditions are met, allowing investors to take immediate advantage of time-sensitive trading opportunities.
Qredo only exercises part-delegated authority over the custodial account, and can never access the assets within it. Each party involved in the custody process must also be successfully multi-factor authenticated, ensuring compliance with the latest digital asset custody laws.
Whoever is in control of the custodial account has sole knowledge of where funds are sent, creating complete privacy.
Unlike multisig services in which participants must be known ahead of time, Qredo enables multiple parties to be assigned or reassigned to a custodial account to approve the redemption requests, even after the custodial account has been funded and exists on the blockchain.
Instead of relying on trust, Qredo’s decentralized network allows any party to cryptographically verify that the digital assets truly exist in the custodial account.
All communications over the Qredo network are signed by the sending and receiving parties. These digital signatures are stored as a permanent record on the Qredo Custody Network, enabling completely transparent regulatory interaction and corporate governance.
Qredo’s Custody Network offers support for the highest number of cryptocurrencies and security tokens on the market today.