Cryptocurrencies, despite being an infamously volatile and unregulated industry, do make up for a trillion-dollar sector with millions of investors participating on a daily basis. In order to offer the next advanced safety solutions for digital assets, Cryptosat and Dfns have come together to create a ‘Space Wallet’. This service will have private keys of crypto wallets saved in the low-Earth orbit, making it inaccessible to malicious actors.
A team of Stanford University alumni formed Cryptosat, a startup that develops satellites which fuel and improve cryptographic, blockchain, and ledger applications. Dfns, on the other hand, is a computer and network security company that provides a wallet infrastructure for Web3.
Together, these two entities have designed the Space Wallet. To offer an improved security against financially damaging attacks, the Space Wallet will use an ‘innovative threshold signature scheme’.
Essentially, this means that for private key shares to be distributed between multiple signers, it must provide their approval for a transaction to be confirmed. In addition, the Space Wallet supporting Cryptosat satellite will also need to co-sign (approve) the transaction.
Cryptosat will also ensure that all transactions are fully auditable.
As per a report by Cryptowisser, in case a transaction is flagged suspicious or compromised via a ground-based infrastructure, the crypto satellite’s special functionality will come into immediate effect.
The satellite’s immutable transaction audit ledger will log the incident and provide data that can help law enforcement authorities track the attacker responsible.
“Cryptosat’s satellites are located in low-Earth orbit and therefore remain completely inaccessible even to the most well-funded, state-sponsored hackers. The company also employs advanced monitoring techniques to ensure that any attempt to get close to its satellites will be detected,” the report quoted Cryptosat founder Dr. Yan Michalevsky as saying.
Christopher Grilhault des Fontaines, the CEO and Co-Founder of Dfns, posted about the development on Twitter.
Space Wallet marks the initial stride of a long journey in the evolution of wallet security. We say welcome to cryptographers, security experts, and protocol designers that want to join us in resolving the many business, regulatory & security challenges of the web3 wallet arena.
— Christopher Grilhault des Fontaines (@christophergdf) June 26, 2023
Last year was the worst on record for cryptocurrency heists, with hackers stealing as much as $3.8 billion (nearly Rs. 31,100 crore), led by attackers linked to North Korea who netted more than ever before, a Chainalysis report had claimed in February 2023.
A total of 24 crypto exploits were recorded by blockchain security firm in January this year. Collectively, these exploits amounted to loss of $8.8 million (roughly Rs. 72 crore).
Several non-custodial wallet service providers recorded an exodus of users after back-to-back hacks. Failure of multiple crypto projects also posed grave threats to their financial stability.
Space wallets could become the next technological advancement, that could bring back users’ trust for non-custodial wallet service providers.
As for Cryptosat, in January this year, a Falcon 9 rocket from Elon Musk’s SpaceX released Crypto1 satellite from the Cryptosat team into the Earth’s orbit. Like its predecessor, this satellite is aimed at powering cryptographic, blockchain and ledger applications.
The physical inaccessibility of satellites makes them a secure point-of-information storage, that guarantees the confidentiality of sensitive data and computations.
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