Current Solutions

Risk management tools available today fall into four broad categories:

  • Centralised Custodian Policy Layer

    • Requires great trust in custodian. Risk of asset freezing due to government controls, rug pulls, hacking.

    • Requires cost hurdle to be overcome. Lowers ROI and does not suite smaller players with assets under management less than $100M.

  • Smart Wallets / Vaults (Argent, Gnosis)

    • Features such as social recovery and asset custody for automated transactions are useful but introduce smart contract risk. Possibly due to this the risk controls available lack sophistication.

  • Decentralised Custodians

    • Assets move away from L1 chains into bespoke L2 chains that are not as decentralised. May introduce risks inherent in bridging assets.

    • May not be full self custody. Platform requires key share/shard under its control.

  • In-house Tooling

    • Expense to develop and maintain

    • Sophisticated tooling closed source to maintain competitive advantage

    • Increased risk of bugs/flaws for exploit compared with open source system

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