With average daily trading volumes in January 2018 in excess of $50bn*, cryptocurrencies rival some of the world’s most liquid assets. Demand is particularly strong in Switzerland, Europe and Asia, while in the US CME offers futures to trade bitcoin, indicating their growing importance as an asset class.
Yet many banks and other financial -services providers do not have the necessary technology to fully participate securely in this burgeoning market.
Cryptocurrencies are stored securely in distributed ledgers – blockchains. A digital key gives access to the cryptocurrency asset stored on a blockchain. These keys need to be kept safe because if lost or stolen so is the asset.
Risk of loss or theft
Specialist technology is required – theft and loss are not unknown. Some 1.5m bitcoins have been stolen at least once since 2010 and major custody companies have been hacked.
Most banks and financial-services providers still lack the necessary technology to store, process and trade these keys without risk. This is of particular concern to private banks whose customers increasingly demand this new asset class to diversify their portfolios.
Where a service is offered, it is highly manual, expensive, inefficient and insecure. As a result, customers are turning to rival services from fintech start-ups, which control at least half the market.
SILO is a cryptocurrency custodian solution designed specifically for banks and other financial institutions wanting to participate efficiently in this new market.
The need to store cryptocurrency keys and move assets securely is a regular part of financial services today - with SILO, banks will be able to introduce and deliver this service efficiently, seamlessly and cost effectively.SILO is an integrated software / hardware solution that has been developed in cooperation between Guardtime and Metaco, a company with a successful history of managing cryptocurrencies and building digital wallets / custodian solutions for retail customers.
- A front to back-office cryptocurrency solution
- Military-grade hardware to provide the highest levels of cyber-security and physical custody to allow institutions to store cryptocurrency keys and process transactions securely
- A multi-account wallet- management system that can be installed on-premise or accessed as a service and can support many different cryptocurrencies
- Built-in full audit trails
- Dedicated support
- High availability guarantees
- Security features including custom access rights, transaction flow limits, multi-signature and conditional locks
- Pre-integration with Temenos