Stealth startup Anchor Labs has reportedly launched a cryptocurrency custodial service for institutions, claiming that it is more secure and easier to use than cold storage wallets.
The cryptocurrency custodial service, which has been named Anchorage, is a digital asset custodian capable of delivering “all the benefits of asset accessibility,” including staking management, voting, PoE confirmation and swift transactions.
Anchor Labs was founded by Diogo Mónica and Nathan McCauley, who previously worked on encrypted credit card readers at Square and ran Docker’s security team. The company previously $17 million in a series A round backed by Andreessen Horowitz, Max Levchin, Khosla Ventures, Blackrock’s Mark McCombe, Elad Gil and AngelList co-founder Naval Ravikant.
The new Anchor Labs cryptocurrency service was announced Wednesday.
“Until now,” said Monica and McCauley, “investors have been constrained by the limitations of ‘cold storage’ custody, which is vulnerable to human error (or worse) and holds assets inaccessibly so they are slow to move and can’t be used to capture yield, which can lead to depreciation due to dilution over time.”
The Anchor Labs founders also said in a blog that financial institutions are interested in cryptocurrencies, but are typically forced to choose “between security and asset productivity.”
Anchor Labs is not the only firm looking to provide new storage solutions for cryptocurrency and digital assets. Cold storage custodians BitGo and Kingdom Trust recently announced a partnership with liquidity providers to enable trades to be executed while the traders’ cryptocurrency remained in storage.
According to a spokeswoman for Anchor Labs, “Anchorage is the only custodian to have solved digital asset custody by eliminating human points of failure.” Though the spokeswoman did not provide further details, she did add that Anchorage users “can move their assets within minutes of transaction approval.”
Monica and McCauley have said the idea for the company came about when digital asset funds requested assistance managing their private keys securely.
“As we grew to understand the problem,” they said, “we envisioned a solution based on the security principles we understood well: one that combines multi-person integrity with hardware-based systems, allowing us to build a platform that is more secure than cold storage, but has the benefits of keeping the assets accessible.”
They also said that Anchorage “applies the world’s most advanced and proven digital security architecture to better support institutional investments, while enabling active on-chain participation that offline cold storage historically hasn’t allowed.”
According to the Anchor Labs founders, the enhancement of cryptocurrency custodial services may provide an influx of funding to the industry and form the foundation of “a rich and mature financial ecosystem.”