Exploring Cryptocurrency Storage During Bitcoin Halving: Insights from Manhar Garegrat

The highly anticipated ‘Bitcoin Halving’ on or around April 20th is a significant moment for cryptocurrency investors, traders and other stakeholders. With each half-life ready, Potentially reshaping market dynamics, further strengthening the spotlight on the critical role of digital asset management. Against this background, Ravi Kumar from AlexaBlockchain was interviewed. Manhar Garegrat, Regional Head, India and Global Partnerships, Liminal Custody Solutions.

Respected for its robust digital asset management and wallet infrastructure, Liminal boasts an excellent track record of protecting over $700 million in assets.

As the cryptocurrency community stands on the threshold of the fourth Bitcoin halving, the insights shared by Garegrat illuminate the complex interplay of challenges and strategic needs for custody service providers. From navigating the turbulent waters of market volatility to strengthening the fortress protecting your digital assets, Garegrat’s perspective is an in-depth look at the advanced preparations and innovative solutions Liminal has created to ensure the security of your digital assets at these critical moments. Provides:

The conversation explores the nuanced landscape of cryptocurrency storage, highlighting the multi-faceted challenges posed by the halving event, the essential role of custody services in protecting assets, and the sophisticated security measures underpinning Liminal’s infrastructure. It also covers actionable steps individuals can take to protect their digital assets and the insurance protections Liminal extends to its customers.

As we approach another halving milestone, this conversation between Kumar and Garegrat not only demystifies the complexities surrounding digital asset management, but also highlights the paramount importance of security and preparedness in the ever-evolving realm of cryptocurrencies.

Q1. Are there any specific challenges that cryptocurrency custody service providers foresee given the upcoming Bitcoin halving event? How are these challenges unique compared to typical operational risks?

Manhar Garegrat: While there will be no direct impact as a result of the upcoming 4th Bitcoin ​​halving, there are several secondary effects that all VASPs, including cryptocurrency custody providers, must actively consider and manage.

One major challenge This is due to heightened market volatility and increased trading activity around the halving event. This volatility increases the risk of cyber threats, such as hacking attempts and phishing attacks, that typically target digital asset custodians and their customers.

Additionally, with the influx of new investors, As media attention increases during a halving event, operational challenges are greatly amplified, from increased trading volume to scalability issues. These challenges are unique compared to typical operational risks due to sudden surges in market activity and increased interest and scrutiny around halving events.

Q2. Can you explain the role of custodial services in ensuring the safety and security of digital assets during periods of increased market activity, such as halving events?

Manhar Garegrat: Custodial services play a critical role in ensuring the safety and security of digital assets, especially during events such as the Bitcoin halving, which may result in amplified price volatility and activity.

Custodians establish a safe environment. We utilize advanced encryption methods, multi-factor authentication, and continuous monitoring systems to protect your digital assets from cyber threats and unauthorized access.

By strengthening security measuresManaged services establish guardrails that help effectively mitigate the risks associated with theft, fraud, and operational errors that are more likely to occur suddenly during periods of active market activity.

Q3. Can you share details about your cold and hot wallet security measures and how they are optimized for events like the Bitcoin halving?

Manhar Garegrat: At Liminal, we understand the key bottlenecks for institutions when dealing with digital asset wallets. Therefore, we have a hybrid wallet infrastructure with best-in-class security parameters to protect your assets from all kinds of external and internal attacks.

To protect both cold and hot wallets, we deploy the following practices:

• Liminal is the second wallet provider to receive CCSS Level 3 certification, with both hot and cold wallets passing the audit and becoming a QSP.
• As a CCSS certification platform, we follow rigorous key generation and backup practices on institutional grade devices like Cryptosteel.
• Our cold storage is protected by FIPS 140-2 Level 3 certified HSM devices such as Trezor and Ledger.

We support dynamic configuration of wallets:

• Multi-Signature Wallet
• cold wallet
• wallet refill
• MPC Wallet
• deposit wallet
• withdrawal wallet
• mobile wallet

Cold storage utilizes generating multiple private keys from a single master seed. This creates numerous secure locations to store client assets, greatly reducing the risk of a single point of failure.

For hot wallets, we use a multi-layered security approach that includes:

• Multi-factor authentication (MFA) adds an additional layer of security during login attempts.
• A secure transaction approval process ensures that all transactions require appropriate approval procedures.
• Hardware Security Modules (HSMs) provide an additional level of protection by protecting the private keys used for hot wallet operations.

By implementing these strong security measures, Liminal ensures the safety of your digital assets regardless of market conditions.

Q4. What steps can individuals take to ensure the safety of their digital assets during the halving?

Manhar Garegrat: To ensure the safety of digital assets during the halving period, individuals can take several precautions.

First, you need to choose a reputable management service. Prioritize security and compliance. For users who are comfortable managing their own wallets, security can be further enhanced by implementing advanced security measures, such as multi-signature wallets that require multiple private keys to authorize transactions.

Regardless of the storage method you chooseIt is important to regularly monitor your accounts for suspicious activity and stay informed of new security threats.

Q5. How does your insurance coverage, if any, protect investors’ assets during halving periods and in the event of a security breach?

Manhar Garegrat: Liminal provides insurance coverage (up to $50 million) to protect customer assets in the event of a security breach. Each customer asset is guaranteed in proportion to its AUP. We also use enterprise-grade security measures and multi-key backups to further protect your assets.

thank you!

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To learn more about Liminal Custody Solutions, visit https://www.liminalcustody.com/.