New DeFi Firewall for Smart Contract Transactions
Today, leading crypto custody solutions provider Trustology has announced that it will be the first to offer institutional DeFi market participants new smart contract safeguard controls across protocols with no compromise to convenience, security or transacting in real-time.
Liquidity harvesting opportunities such as yield farming is currently driving adoption and demand in DeFi for institutions looking to maximise returns—over $8 billion in locked value. Unlike the 2017 craze, this new wave of investment is ushering in more players from the traditional world signaling a rapidly maturing market or possibly a second bubble. Either case, businesses still face intense scrutiny from investors and regulators to ensure assets are protected against a number of external and internal threats and to demonstrate compliance if they want to secure more investments into their digital assets operations or grow profits. Further complicating matters is the nascency of smart contracts technology, where participants have had their fair share of attacks since 2018 when DeFi first emerged.
Certain blockchains have endeavoured to protect smart contracts that are built by improving their security at the blockchain level from malicious hacks by preventing unauthorised access, but to date, there have been no security measures installed at the wallet level and regulators are still at an impasse as to how to govern let alone mitigate the risks of smart contracts.
While several DeFi-primed wallet solutions exist today, none offer custodial services and were designed with the individual in mind, lacking the institutional controls for businesses to legally operate in DeFi. For institutions managing large numbers of transactions, manually self-custodying and securing those assets is impractical and too costly.
At the present pace of development in DeFi, timing is everything and if an opportunity is missed or takes too long then businesses face liquidation by DeFi protocols. But security is still a first priority and concern, compounded by the need for speed and scale.
This is where crypto custodians like Trustology come in. The company has been innovating in the security and management of private keys since its inception in 2017 with its TrustVault solution. As the only custodial wallet to have integrated with MetaMask, institutional users such as investment managers and brokers benefit from securely working with DeFi protocols either manually or automatically across web and mobile apps or APIs using their TrustVault private keys. With its latest DeFi Firewall controls for smart contract transactions, Trustology allows institutional users to securely and easily move assets between DeFi protocols using advanced security controls, allowing them to navigate the ecosystem in real-time whilst removing barriers of trust with their clients looking to place funds with them.
This is because Trustology’s TrustVault solution proxies every transaction through the system’s rules engine, and only signs the transactions with custody keys that are then sent to the network for verification. If all the controls are satisfied e.g. protocol smart contract address, contract method, and method parameters, including token smart contract and external addresses are in the allowlists.
“As the DeFi firewall is built on top of the TrustVault platform, it inherits all of the platform’s infrastructure benefits such as its HSM encased proprietary resigning firmware, combined with insurance and advanced multisig and allowlist safeguards,” says Alex Batlin, CEO and founder of Trustology.
Advanced hardware and cloud-based security system infrastructure ensures the platform is scalable and resilient and capable of signing and submitting transactions faster – with sub-second transaction processing times. The company has currently been focused on enhancing its web and mobile apps, MetaMask extension, APIs and webhooks as it has seen increased institutional demand across funds and brokers.
“DeFi is at an all-time high in terms of locked value, trading volumes, innovation, growth and risks. Institutions want to be able to know they can either borrow, then CDP their ETH with MakerDAO to mint DAI stable coin or lend money, using Compound Finance for instance. And they want to do so in the safest, fastest and easiest way. We just want to ensure we are the crypto spacesuit that institutional DeFi pioneers have been waiting for,” notes Batlin.
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