Blockstream Launches Thales-Backed Custody System

Bitcoin infrastructure company Blockstream has launched a new institutional digital asset custody solution developed alongside French technology group Thales. The offering combines Thales’ hardware security modules (HSMs) with Blockstream’s Secure Multi-Party Computation (Secure-MPC) technology.

According to the company, the architecture executes the entire transaction signing protocol within the protected environment of Thales’ hardware rather than performing portions of the process outside dedicated hardware. Blockstream co-founder and CEO Adam Back argued that conventional multi-party computation protocols are often too complex and interactive to be practical for fully offline cold storage.

Security Focus Amid Cyber Threats

Back highlighted recent high-profile incidents, such as the Binance incident where attackers compromised employee credentials to access wallet-signing infrastructure, to emphasize the risks facing internet-connected custody setups. He noted that artificial intelligence could further complicate security challenges by helping attackers uncover subtle implementation flaws in complex MPC implementations.

Back advocated for simpler offline security models to reduce exposure to potential attacks. The company's new custody solution aims to keep sensitive cryptographic operations within dedicated security hardware while allowing institutions to authorize transactions.

Key facts

• Blockstream and Thales launched an institutional digital asset custody solution combining hardware security modules and Secure-MPC technology.
• The system executes the entire signing protocol within the protected environment of Thales’ hardware security modules.
• Blockstream co-founder and CEO Adam Back stated that conventional multi-party computation protocols are too complex for offline cold storage.
• Back pointed to past exchange compromises to highlight the risks associated with internet-connected wallet-signing infrastructure.