For cryptocurrency (such as Bitcoin) investors, it is of utmost importance to store them securely. But unfortunately, it doesn't always go as planned. Every once in a while there are minor or major hacks. Or, well-known parties go bankrupt, causing clients to lose access to their crypto, as we saw with Celsius in 2022. With dire consequences: some investors lost all their crypto in one fell swoop.
We believe there are better ways to go about crypto security. And it doesn't have to be complicated at all. That's why we built the Blockrise Wallet: ultra-secure storage, where only the client actually owns their crypto.
It is a well-known phrase in the world of crypto: "Not your keys, not your coins". This statement emphasizes the importance of being in control and having the private keys and thus access to your crypto yourself.
Among exchanges and brokers, there is an industry standard to throw all their customers' assets into one big pile. This poses a major risk, as these wallets are sought-after targets for criminals. And, customers of these platforms typically only have a login for their account, but not the keys to their crypto wallet. Although it may seem like the customer has control, the platform holds all the power.
We don't believe this is the way to go, and we strive to set a new industry standard with our wallet solution. We can never access your stored assets in any way. All of the crypto assets stored with us are protected by our wallet technology. We secure your investments, you remain in control.
There's roughly two types of storage: hot storage and cold storage.
With hot storage, the crypto is stored in a piece of software, connected to the Internet. This could be, for example, a "hosted wallet" at a crypto exchange, or a wallet such as MetaMask or TrustWallet. The hot storage is usually accessible on a mobile phone, on your computer of in the browser itself.
Hot wallets are especially convenient for everyday use because they can make transactions from the wallet itself. Because they are connected to the Internet, they are more vulnerable to online threats such as hacks and phishing attacks.
With cold storage, the crypto is stored offline. For example, on a type of USB stick that is cryptographically encrypted, also known as a hardware wallet. Examples of hardware wallets include Trezor and Ledger. Only when the wallet is connected to another device, such as a computer, the keys can be entered and the crypto can be moved. This makes this storage more secure than hot storage: if the wallet is not connected, a hacker cannot access it.
The ease of use is lower with cold storage wallets and it takes more steps to trade.
| Hot storage | Cold storage | |
|---|---|---|
| Security | Lower: it's hosted online | Higher when not connected |
| Ease of use | Convenient for transactions | Takes more steps |
| Risks | Higher risk of hacks | Theft, damage or loss |
There are two types of storage: hot and cold. But within the types of storage, there are different types of wallets. Some well-known wallets are hardware wallets, paper wallets, and multi-sig wallets.
A paper wallet is when all the required information is actually written down on paper. The access is offline and secure from hackers. The risk of losing the information is high though, so this wallet is only suitable for those who are careful enough to properly store and preserve their paper.
You can also keep your Bitcoin safe with a third type of wallet: multi-sig. A multi-sig (multi-signature) wallet requires more than one signature to gain access. There are more than one set of private keys. The amount of keys and how many are needed varies. There are 2-of-2 multi-sigs, 2-of-3, 1-of-2, and so on.
The private key gives access to a wallet. Therefore, it is important to never share it: if someone has both the private and public keys, they can empty your wallet.
Another risk is the loss of this key. Without the key, the wallet and its contents are no longer accessible. A private key cannot be recovered the way it works when clicking a button to reset a forgotten password. To eliminate this risk, there are also specialized parties that safeguard private keys for their users. Do note that some parties require a (very hefty) minimum entry fee.
Unlike the industry standard for crypto exchanges, Blockrise offers a solution where we secure and manage assets, but our clients hold their own keys.
When creating their account, the client creates a personal key of 24 random words. The client keeps this key. We do not keep a copy of it. Due to this strict security measure, it is not possible to restore access to funds in case of human error, such as losing the keys. To provide a backup solution while maintaining security, we offer the possibility of keeping additional keys.
Only the highest security standard is good enough for us. We use banking-grade wallet technology and secure all assets in Blockrise wallets using Swiss Hardware Security Modules (HSMs). These HSMs are used by the largest banks worldwide and are stored in a Swiss bunker.
All client wallets are completely separated, even when participating in our crypto asset management. In addition, all our services are built with both Dutch and European regulations in mind. As a crypto platform, registered with the Dutch Central Bank (DNB), we continue to innovate in terms of security and usability.
The chances of getting hacked are very low, but if a hacker gets in at all, they can do little because Blockrise holds no personal keys of clients. Clients' crypto assets are stored individually and euro assets are kept in a separate foundation. So in the event of Blockrise's bankruptcy, the assets are safe.
There are several advantages of the Blockrise Wallet over a hardware wallet with cold storage. For example, a hardware wallet can get lost or damaged. Both the device itself (the hardware) or the software running on it can break down. Blockrise has taken several measures to prevent our software from becoming inaccessible.
Cold wallets often require multiple, sometimes complex steps to move the crypto to a broker before it can be traded. With Blockrise, on the other hand, it only takes a few clicks to sign and send transactions. In short, the Blockrise Wallet has the security advantages of cold wallets, without the inconveniences that traditional cold storage methods bring.
Secure your crypto and invest with Blockrise.
Follow investment strategies, available with Blockrise Portfolios.