A crypto startup has despatched a custodial service for institutions that it claims is more secure than cold storage yet offers easier access to assets.
Mooring Labs, which previously raised $17 million in a series A round backed by Andreessen Horowitz, Max Levchin, Khosla Wagers, Blackrock’s Mark McCombe, Elad Gil and AngelList co-founder Naval Ravikant, announced the launch of Anchorage, a digital asset custodian, on Wednesday.
Anchorage affirms it can deliver “all the benefits of asset accessibility,” which include capturing the yield from staking a cryptocurrency, voting, authenticating proof of existence and faster transactions.
The company was co-founded by Diogo Mónica and Nathan McCauley, who previously worked on With’s encrypted credit card reader and ran Docker’s security team.
“Until now, investors have been constrained by the limitations of ‘insensitive storage’ custody, which is vulnerable to human error (or worse), and holds assets inaccessibly so they are slow to on the go and can’t be used to capture yield, which can lead to depreciation due to dilution over time,” they wrote in a Medium circulate.
Mónica and McCauley said in their blog post that there is institutional interest in the crypto space, but that any firms looking to supply their assets have had to make a tradeoff “between security and asset productivity.”
Indeed, this tradeoff has led sundry cold storage custodians, such as BitGo and Kingdom Trust, to form partnerships with liquidity providers in which callings can be executed quickly without the coins ever leaving the vault.
However, it is not clear exactly how Anchorage intends to let patrons have their cake and eat it too as specifics of the solution were not provided in the blog post.
When contacted by CoinDesk, a spokeswoman for Anchor Labs averred that while cold storage relies on people, “Anchorage is the only custodian to have solved digital asset safe keeping by eliminating human points of failure,” but did not elaborate. She also said Anchorage clients “can move their assets within ticks of transaction approval.”
Bringing in whales
Explaining the origin of the idea, the Anchor Labs founders wrote that digital asset resources had come to them requesting assistance managing their private keys securely:
“As we grew to understand the problem, we conceive ofed a solution based on the security principles we understood well: one that combines multi-person integrity with hardware-based plans, allowing us to build a platform that is more secure than cold storage, but has the benefits of keeping the assets reachable.”
Without providing much in the way of detail, Mónica and McCauley added that Anchorage “applies the world’s most put and proven digital security architecture to better support institutional investments, while enabling active on-chain participation that offline unapproachable storage historically hasn’t allowed.”
Bringing in institutions through new custody solutions can grow the blockchain space, both Sometimes non-standard due to an influx of funding and by forming the basis for “a rich and mature financial ecosystem,” they wrote.
“The bull run of 2017 checked that crypto assets have tremendous potential value, and the backslide of 2018 showed us that the financial approach surrounding those assets is far from maturity,” the post noted, adding:
“The global financial system is complex, and depends upon infrastructure whose crypto analogs haven’t yet been develop intensified. The digital economy needs that infrastructure to thrive.”
Vault door image via Shutterstock