In an industry where major exchanges continue to suffer high-profile security breaches, Bitpanda Custody’s approach to asset protection is engineered to prevent the most common—and often catastrophic—attack vectors. From our off-chain multi-signature architecture to rigorous transaction validation and governance mechanisms, Bitpanda Custody’s infrastructure was built with security at its core.
1. Off-Chain Multi-Signature Model
Unlike many exchanges that rely on on-chain multi-signature contracts, such as Bybit’s recently compromised Safe infrastructure, Bitpanda’s TrustVault uses an entirely off-chain multi-signature implementation.
This architectural decision shields critical metadata—like quorum requirements and signer addresses—from being publicly visible and potentially exploited. On-chain contracts expose patterns over time, enabling attackers to reverse-engineer quorum structures and target signers. Bitpanda’s off-chain approach keeps all such information confidential, significantly reducing the attack surface.
2. No Blind Signing – Intent Verification for Every Transaction
Bitpanda enforces strict transaction intent validation. Whether initiated by users via the TrustVault iOS app or programmatically via API, every transaction must pass a verification step:
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iOS-based signing ensures the transaction hash exactly matches what is displayed to the user.
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API-based signing mandates the inclusion of the unverifiedDigest, which is verified before the signature is issued.
This approach eliminates the risk of blind signing, a vulnerability exploited in several recent exchange breaches where signers unintentionally authorised malicious transactions.
3. Separation of Duties: Spending vs. Governance
Bitpanda enforces a hard separation between asset spending and policy rule changes. While other systems (like Bybit’s Safe) allow both to be executed via similar transaction flows—making it easier for attackers to disguise governance changes—Bitpanda segregates these entirely:
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Transaction approvals are managed independently of any changes to access control, key rotation, or signer policies.
This eliminates the risk of a malicious actor “sneaking in” a governance change alongside what appears to be a normal transaction.
4. Cryptographic Co-Signing as Standard
Bitpanda has operated a dedicated co-signing service for over five years—a robust cryptographic checkpoint that validates every outgoing transaction against pre-set policy rules.
This service operates independently of the multi-sig quorum, acting as a second layer of verification. Unlike Bybit’s Safe, which currently lacks such a system (though future plans have been announced), Bitpanda’s model ensures multi-layered transaction authentication, making unauthorised spending even more difficult.
Conclusion
Bitpanda Custody’s security design is fundamentally different from the models commonly seen at exchanges. Our off-chain multi-sig, intent validation, separation of governance and spending, and co-signing service not only neutralise common attack methods but also anticipate future threat vectors.
As hacks become more sophisticated, Bitpanda Custody remains ahead—providing the cryptographic assurance and institutional-grade security our clients need to operate with confidence.