The Rapidly Increasing Value of Digital Assets Demands Better Security.
SecureMyCrypto

The Rapidly Increasing Value of Digital Assets Demands Better Security.

Digital Asset protection sorely needs an upgrade.


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 their protection needs to be dramatically upgraded too, commensurate with what is being protected.

In a general sense, 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 is no longer quite right to describe a digital asset in this way, and that changes in the world over the past few decades warrant an updated 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 to the control of anything and everything.

In other words, cryptocurrency and digitization have altered the notion of a digital asset — from what once represented simple information on a machine into something that represents real-world identities, big data, and financial objects.

Image showing the increasing value of digital assets.

The increasing value of digital assets.

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 mass 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 requires a trade off between the value of the asset, the cost of security, the overall reduction in risk, and of course convenience. People choose to put photos in cloud storage systems versus bank vaults. However, as the value of assets has increased, 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 greatly changed.

Cryptocurrency and Blockchain

Since the invention of cryptocurrency, a broader vector of digital assets has taken the spotlight: the subclass of digital financial instruments that can be used as a store of value or a means of exchange. So far, these assets often have been stored in what can only be described as risky mediums, e.g., online accounts and USB devices. The private keys behind these assets are essentially left to individuals to protect in a scheme of their own choice.

"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

Meanwhile, billions of dollars of blockchain-based cryptocurrency have been lost to hacks or other unfortunate occurrences.

Image of WSJ article about lost crypto.

Some crypto is simply lost.

20% of all Bitcoin is lost forever. That's many billions of dollars of value, and in fact, in 2018 alone, over $1.1B was stolen.

What is the next phase in digital asset protection?

The security of 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 vigorously explored, improved, and researched to robustly respond to this rapid demand for stronger security.

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

Thanks to Blake Commagere.

https://www.linkedin.com/company/vault12
https://twitter.com/_vault12_
SecureMyCrypto

The Rapidly Increasing Value of Digital Assets Demands Better Security.

Digital Asset protection sorely needs an upgrade.

Discover More

Featured Articles

avatar-icon

Vault12 Crypto Security

Social Recovery Vault for Digital Asset Security + Digital Inheritance for protecting the future of money.

star-background

Backup and Inheritance for Bitcoin

vault12-guard
Vault12 Guard Explainer
Get the Vault12 Guard app onto your phone
QR code Vault12 Crypto/NFT InheritanceDownload Vault12 on App StoreDownload Vault12 on Google Play
Vault12 app mockup
Scroll down
Close

Vault12 Product Demo

Get The Vault12 App Onto Your Phone

Download Vault12 on App StoreDownload Vault12 on Google Play
Screenshot of Add Inheritance in Vault12 Guard App

Inheritance: Get ready today.

Vault12 Digital Inheritance is the first solution to deliver an effortless and secure method for transferring a variety of digital assets — including Bitcoin (BTC), Ethereum (ETH), other cryptocurrencies, and data — to future generations.

This innovative system enables users to appoint either a person or a mobile device as a guardian. The designated guardian is entrusted to protect the user's comprehensive collection of digital assets, encompassing seed phrases, private keys, and other confidential information, safely stored within a decentralized digital Vault.

This process not only mitigates potential risks but also removes the necessity for regularly revising asset inventories or modifying instructions, which often leads to breaches in privacy.

Screenshot of Vault12 Guard apps - Add an Asset screen

Secure Decentralized Backups and Storage.

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

Note:The Vault12 Guard app is not a crypto wallet and does not hold cryptocurrency. Using a non-custodial approach, a digital Vault safeguards your Bitcoin or Ethereum wallet seed phrases, private keys, and other essential data.

The Vault12 Guard app enables secure decentralized backups and provides inheritance for all your digital assets, including Bitcoin, Ethereum, crypto wallets, and other digital data.

Collectors, ensure your Art is protected for the future.

Collectors, ensure your Art is protected for the future.

Whether your digital art is suitable for a phone, or represents much higher resolution multimedia, make sure that you have backed up a copy in case the resource link is disrupted in the future. Digital art can easily be added to the Vault either via the mobile app or via the desktop utility. Once you have stored your artwork in your Vault, it will also benefit from inheritance once you activate that in your app.

Screenshot of Vault12 Guard app - Adding data into the Vault

Protect your home and family's data.

Whether you are at home or away, make sure that essential data about your home and family - including IDs, medical records, insurance information and home safe combinations - is backed up and available at your finger tips.

With a secure decentralized backup Vault, you can ensure that, in any event, you always have access to important information, wherever you are.

Learn

Step-by-step guides for setting up your digital Vault and adding assets, inheriting and restoring Vaults. Vault12 Guard helps you inherit and back up all assets stored in your Vault, including Bitcoin, Ethereum, crypto, private keys, seed phrases, digital wallets, and essential home & family data.

Teacher explaining how to to use Vault12 Guard

Vault12 Digital Inheritance is the first solution to offer a simple, direct, and secure way for all types of investors to ensure that all of your digital assets can be accessed by future generations.

The Vault12 platform provides protection, backup resilience, and security to your digital assets. Vault12 Digital Inheritance enables you to designate a beneficiary (an executor, trustee, or other chosen beneficiary) who can inherit the entire portfolio of digital assets that you choose to store in your Vault. There is no need to continually update an inventory or to issue updated instructions.

Decorative Background

Get started now.

Vault12 Guard is now available from the iOS and Android App Stores.
Download Vault12 on App StoreDownload Vault12 on Google Play
Close
Start protecting your digital assets: Free 30-day trial available today.