A security incident at a major exchange serves as a reminder of the critical need for robust custody solutions in the digital asset space. At Bitpanda Custody, security has always been at the core of our offering, designed from the ground up to mitigate risks that continue to challenge the industry. Our approach to safeguarding assets goes beyond traditional custodial methods, ensuring our clients have confidence in the security and integrity of their holdings.
Here’s how Bitpanda Custody differentiates itself:
Off-Chain Multi-Signature Security
Unlike on-chain multi-signature solutions, which can expose critical wallet policies and signing rules, Bitpanda Custody leverages an off-chain multi-signature (multi-sig) approach. This means attackers cannot easily analyse wallet governance structures or determine the signing quorum required for transactions. In contrast, on-chain multi-sig wallets often leave traces that could provide adversaries with insights into security configurations.
No Blind Signing – Verifiable Transaction Integrity
Blind signing remains one of the biggest security risks in digital asset management, as it can lead to users unknowingly approving malicious transactions. Bitpanda Custody’s solution eliminates blind signing through a robust validation mechanism. Whether signing via our iOS application or programmatically through our API, transaction intent is always re-validated. This ensures that what users see is exactly what they sign, significantly reducing the risk of fraudulent approvals.
Separation of Spending and Policy Changes
A key vulnerability in many on-chain custodial frameworks is the lack of separation between transaction execution and policy modifications. In some implementations, attackers may disguise policy changes as simple spending transactions, potentially taking control of assets without raising immediate red flags. Bitpanda Custody mitigates this risk by enforcing a clear distinction between spending operations and policy rule changes, adding an additional layer of security against unauthorised modifications.
Established Co-Signing Service for Enhanced Verification
For over five years, Bitpanda Custody has operated a co-signing service that cryptographically verifies transactions against predefined rules before authorisation. This added layer of verification ensures that transactions adhere to strict security policies, reducing the risk of unauthorised transfers. While other custody solutions may be looking to implement similar features in the future, Bitpanda Custody has been at the forefront of this practice for years.
Why This Matters
Security breaches remain a persistent challenge in the digital asset space, highlighting the necessity of strong custodial controls that exceed industry standards. At Bitpanda Custody, we prioritise proactive security—protecting our clients’ assets through advanced, battle-tested measures that minimise attack vectors and enhance operational resilience.
By combining off-chain security with advanced transaction validation, policy separation, and an established co-signing framework, Bitpanda Custody offers one of the most secure environments for institutional and enterprise clients. In an industry where trust is paramount, we remain committed to leading the way in secure digital asset custody.
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