Japanese SBI Group, one of the leading global financial services providers, has teamed up with Danish cryptographic company Sepior to create a virtual asset proprietary wallet jointly. The new service, which comes amid growing regulatory scrutiny in Asia, will be integrated into the SBI digital currency exchange VCTRADE, according to a Sepior press release from Monday.
SBI chose the Danish firm’s software due to its multiparty computation (MPC) software called Threshold-Sig Wallet Security. Sepior claims that this technology guarantees a high-level degree of protection for the encryption key.
“After extensive investigation, our security research team determined threshold signatures based on multiparty computation (MPC) offered our desired level of security, performance, and scalability needed to manage transactions for our growing SBI Virtual Currencies customer base”, Yoshitaka Kitao, representative director, president and chief executive officer of SBI Holdings, said as quoted in the press release.
Established in 2014, Sepior uses cryptography to create security solutions that work with various devices and platforms. The company bases its model on two main parts: secret sharing and threshold. The first one splits the encryption key into several shares, which are distributed across multiple parties. The technique reduces the risk of stealing the keys when one of the parties suffers an attack or other security breaches, the Danish company claims.
“Sepior’s threshold model provides the ability to reconstruct lost or corrupted key shares from a threshold (t) number of shares, but not from fewer than t shares,” the company explains on its website.
“This approach protects the secrecy and the availability of the key, even if one or multiple parties with key shares become compromised, as long as fewer than n-t systems are affected. This results in increased integrity and availability of key management for increased security.”
Security is one of the major issues for the cryptocurrency industry in Asia after several large hacks. The $530 million attack on Coincheck in January this year has prompted the country’s Financial Services Agency to introduce new rules including banning of the hot storage.