Blockstream has launched an institutional Bitcoin custody system built with Thales that runs the full signing protocol inside dedicated security hardware. CEO Adam Back says simpler, offline setups protect better against cyberattacks, including AI-assisted ones.
Blockstream, the Bitcoin infrastructure company led by Adam Back, launched a new institutional custody solution developed with French technology group Thales. Back is pushing for simpler, offline security as cyberattacks grow more sophisticated.
Signing stays inside the hardware
The system combines Thales' hardware security modules (HSMs) with Blockstream's Secure Multi-Party Computation (Secure-MPC) technology, according to the company. Institutions can authorize transactions while sensitive cryptographic operations remain within dedicated hardware.
Blockstream says conventional MPC implementations may perform parts of the signing process outside security hardware. Its design, by contrast, executes the entire signing protocol within the protected environment of Thales' HSMs. Crypto Briefing reports that Blockstream Enterprise supports several signing models, including air-gapped setups and multisignature systems.
Back argues complexity weakens security
Back told Cointelegraph that MPC protocols are often too complex and too interactive for fully offline cold storage. He said that connecting equipment to the internet carries the risk of unauthorized access, even behind firewalls.
He cited the Binance $6.3 billion hack as an example of the risks facing internet-connected infrastructure. According to Binance's investigation, attackers compromised employee devices and obtained credentials that let them reach the exchange's wallet-signing infrastructure.
Back also said AI could make these challenges harder to manage, because it can help attackers find small implementation errors in complex MPC systems. He hopes the wider custody industry follows, with institutions moving assets into cold storage. As Back put it: "Complexity is the enemy of security."
Sources: Cointelegraph, Crypto Briefing
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