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The Rapidly Increasing Value of Digital Assets Demands Better Security
SecureMyCrypto

The Rapidly Increasing Value of Digital Assets Demands Better Security


There was a time when the most important things people stored in the cloud were photographs and resumes. Now digital assets include bank account credentials, cryptocurrency, car keys, and house keys. The value of these assets has dramatically increased, so the protection needs to be dramatically upgraded too, commensurate with what is being protected.

A digital asset is a digitally stored, intangible object that is owned (by someone or something) and could have value.

However, one could argue that it isn't quite right to describe a digital asset in such this way. Changes in the world over the past few decades have warranted a change in the definition. Ten years ago, a digital asset was something very different. What once represented images and documents now potentially represents entire financial systems, information oceans, and access points to the control of anything and everything.

As a thought experiment, consider the evolution of cloud sharing. Early iterations of cloud sharing were always intended for people to store items of relatively personal value: photos, documents, videos, animations, audio, or other multimedia content. It wasn't until cloud sharing was possible in the way late implementations like Dropbox established that the storage of digital assets on the cloud began erupting in popularity.

Security Cost and Risk

Protecting assets also requires a trade off between the value of the asset, the cost of security, the overall reduction in risk and of course convenience. People chose to put photos in cloud storage systems versus bank vaults. However as the value of assets has increased, the appropriate security has not kept pace.

Car keys on a phone are already in deployment for many cars. The cryptographic keys giving smartphones access to cars, homes and other precious assets are of immense value. Yet the mechanisms to secure them have not kept pace.

Cryptocurrency and Blockchain

Since the invention of cryptocurrency, a new vector of digital assets has taken to the spotlight. This is a digital asset subclass — one of the digital financial instruments that are used as a store of value and means of exchange. So far, these assets have been stored in what can only be described as risky mediums e.g. online accounts, USB devices and the very mechanisms introduced to safeguard these assets — e.g. private keys — are left to individuals to protect in a scheme of their own devising.

"The Winklevosses came up with an elaborate system to store and secure their private keys. They cut up printouts of their private keys into pieces and then distributed them in envelopes to safe deposit boxes around the country, so if one envelope were stolen the thief would not have the entire key."

"How the Winklevoss Twins Found Vindication in a Bitcoin Fortune" by Nathaniel Popper, New York Times, December 19, 2017

Billions of dollars of blockchain-based cryptocurrency have been lost to hacks or unfortunate occurrences.

20% of all Bitcoin is lost forever. That's $20B, in fact, in 2018 alone, $1.1B has been stolen.

Cryptocurrency and digitization have altered the notion of a digital asset — from what once represented information on a machine into something that represents valuable identity, big data, and finance objects.

With this in mind, the security of these digital assets is a huge concern. In accordance with this abrupt spike in the valuation of digital assets, the security measures used to secure these assets need to be improved. Right now, there are just a few options for securing cryptocurrency and other digital assets; and all of them possess some single point of failure for the user.

Therefore, how custody of these emerging classes of digital assets is handled must be considered. Threats to the security of cryptocurrency storage need to be analyzed, and the correct frameworks for digital custody need to be designed accordingly. Digital custody needs to be explored, improved, and researched vigorously if this rapid demand for stronger security is to ever sufficiently be met.

In future articles, we will look at digital custody and how individuals are dealing with the risks and challenges of protecting their cryptocurrency and other digital assets using Vault12.

Thanks to Blake Commagere.

Recover, Back Up, and Inherit Digital Assets

(including Cryptocurrency Seeds, NFTs and Art)

Every digital asset you own should be backed up, protected and remain accessible. Cryptocurrency in particular is difficult to secure. With natural disasters, hackers, to badly implemented security, you are always at the mercy of others.

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Recover, Back Up, and Inherit Digital Assets

Introducing Digital Inheritance

Pass on your Digital Assets to future generations

Vault12 Digital Inheritance is the first solution to offer a simple, direct, and secure way to ensure digital assets can be accessed by future generations. Digital Inheritance enables investors to designate an individual who will inherit their entire portfolio of digital assets stored in a secure Vault once the time comes, eliminating undue risk and the need to continually update an inventory or continually issue updated instructions.


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Personal Security for your Cryptocurrency and Digital Assets

Designed to be used alongside traditional hardware, software and online wallets, Vault12 helps cryptocurrency owners, ICO investors, professional cryptocurrency traders, and high net worth investors safeguard their digital assets without storing anything in the cloud or in fact any one single location. This increases the protection and decreases the risks of loss.


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Personal Security for your Cryptocurrency and Digital Assets

Easy to setup, easy to secure, easy to access.

A digital Vault containing your digital assets is assigned to trusted people or devices, known as Guardians. Your Guardians can be adjusted as needed in real-time so that the appropriate number are always guarding your digital assets. No one can access your assets and only you get access when you need.


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The Winklevosses came up with an elaborate system to store and secure their private keys. They cut up printouts of their private keys into pieces and then distributed them in envelopes to safe deposit boxes around the country, so if one envelope were stolen the thief would not have the entire key.

Nathaniel Popper, New York Times, December 19, 2017

20% of all Bitcoin is lost forever. That's $20B, in fact, in 2018 alone, $1.1B has been stolen.

Elliott Krause, The Wall Street Journal, July 5, 2018

The idea behind Vault12 is how do we essentially split that responsibility, make that problem of key control less a technological one by essentially making it into a social one with networks of people that they trust.

Terence Spies, former CTO, HP Enterprise, Data Security

Exchanges are the main target for hackers. Those are the biggest honeypots. So the number one rule in Crypto is, do not keep your money on an exchange, and if you're going to custody that money, you need to do it off of the exchange with a product like Vault12.

Joe DiPasquale, BitBull Capital

Security and usability are inextricably linked, the former cannot exist without the latter. Vault12 understands the need for end-to-end management of this experience as well as the importance of integrating into the prevailing crypto ecosystem

Sathvik Krishnamurthy, Founder and Managing Partner, Security Leadership Capital

As we move to a more open financial system driven by advanced blockchain technology and cryptocurrency, we need smarter ways to ensure that the system is trustworthy. Vault12 does this by addressing a foundational need -- ensuring that your crypto assets are not only protected by decentralized security, but also by your trusted inner circle. Your private key never exists in one place or with one entity, reducing risks from hackers as well as everyday accidents.

Vinny Lingham, Entrepreneur and Advisor

Security is the lifeblood of industry, commerce, and leisure. As more people use decentralized applications, they will need a way to back up their crypto wallets and exchange accounts. Vault12 provides a simple and natural way to reduce risks and combat the fear of forgetting seed phrases and private keys.

Jon Callaghan, co-founder of True Ventures

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The Vault12 app is now available from iOS and Android app stores.