Crypto Custody Service on IBM’s Private Cloud Set for Beta Release

According to CoinDesk’s Ian Allsion, New York investment firm Shuttle Holdings will launch the beta version of their digital asset custody solution built on IBM’s private cloud and encryption technologies. These initial services will be for select clients and will provide limited services.

“We have a list of selected clients that we are launching limited service with this month,” said Brad Chun, Chief Investment Officer (CIO) of Shuttle, to CoinDesk.

Later Chun added, “Potential users include banks, brokers, custodians, funds, family offices and high net worth investors who want to do self-custody, as well as exchanges.”

Most custodial services for crypto assets use a cold storage solution for storing private keys, meaning the private keys are stored on offline devices not connected to a network. While some might argue that this method is not only slow, as a human must manually move the asset out of cold storage, but also more prone to bad actors as humans act as intermediaries versus imparcial code.

The IBM Cloud, said Chun, being built on a hardware security module (HSM), is “just as secure, if not more secure” than cold storage solutions. He continued:

“There are always trade-offs between security and efficiency, but we do not utilize a traditional cold storage system. Instead, we keep keys at rest encrypted in multiple layers as data blobs so that an organization can store these backups using their pre-existing disaster recovery and backup processes and media.”

This announcement follows the recent news that Fidelity officially launched Fidelity Digital Asset Services (FDAS) for a select number of clients. While many may not chose to use custodial services for their bitcoin or other digital assets, it’s clear custodial services is certainly a growing industry. Ultimately, the goal of cryptocurrencies is to provide a choice and that extends to storage options.