Crypto custodian Copper’s systems designed to minimize counterparty risk — gunnercooke
Copper, a blockchain asset infrastructure provider, today announced it has obtained a legal opinion from gunnercooke which confirms that Copper has included in its Vault Account crypto-asset custody solution systems and controls designed to minimize the level of counterparty risk to which its clients are exposed.
The law firm’s evaluation involved consideration of the range of different systems and controls put in place by Copper to protect cryptoassets, which are held in segregated wallets dedicated for sole use by that client, including:
- The private key used to transfer crypto-assets out of the segregated wallets is split into three parts, two of which are required to make a transaction, and Copper only has access to one of these parts.
- Ensuring that Copper’s documentation is designed to keep the legal title with Copper’s client rather than transferring legal title to Copper.
- The use of optical air-gaps to create a physical separation between the internet and the vault, which can only be crossed using a QR code.
- Policies for closely controlling potentially sensitive data.
- The ability to require a co-signature process be completed before making withdrawals.
- Obtaining insurance cover.
- Obtaining external coding audits to validate the security standards that have been put in place.
Edward Black at gunnercooke said: “We are delighted to have worked with Copper on this project, which shows a serious commitment by Copper to explaining how Copper seeks to mitigate the risks to its clients inherent in taking custody of cryptoassets. We believe that a core part of trusting any crypto custodian with cryptoassets is having a clear understanding of how they protect those assets. The requirements for keeping cryptoassets secure are continually evolving, and trying to solve the issues involved is no easy task. What was particularly interesting in providing this opinion was to explore the potential for interplay between different methodologies for keeping cryptoassets secure, rather than assuming that there is a single solution.”