Where’s the best place to hide your Bitcoin?
Under the bed? Of course not.
But there is a place that you may not have thought of – underground vaults.
A company called Xapo has developed vaults that it says are located deep underground. One of its backers is Wall Street trader Mike Novogratz. We’ve told you about him raising $250 million for a crypto merchant bank.
He’s partnered with LinkedIn Corp (NYSE:LNKD). co-founder Reid Hoffman for this project.
In this piece, we’ll discuss it.
How idea came to life
To Bloomberg, Hoffman said his venture capital firm, Greylock Partners, led a $20 million investment in Xapo in 2014. Bloomberg reported that two Xapo clients said the vaults house roughly $10 billion of Bitcoin.
Bloomberg reported that an Argentine entrepreneur named Wences Casares persuaded Silicon Valley venture capitalists early on that Bitcoin is the global currency of the future. To put the icing on the cake, Casares told them about his Xapo startup.
About Xapo, Hoffman said:
“They’re the first folks who recognized custodial and security functions would be key. He made the pitch in the morning and in the afternoon I called him with an offer.”
How it works
The Xapo vaults are located deep underground in what the company refers to as “geographically dispersed locations on three continents.”
All confidential information like private keys and cryptographic materials are physically stored on offline servers that never have, and never, will have access to the Internet or any other kind of network, Xapo officials claim.
To store the cryptos, the vaults incorporate multiple layers of cryptographic security. Processes used include multi-factor authentication and private key segmentation.
The servers are guarded by people, as well as by automated security measures. This is done 24/7. The location of the vaults is designed to protect user funds from loss if there is a catastrophic event. If there is a compromise in one location, the other vault location would still be accessible.
Getting the cryptos from the vault
Retrieving bitcoins takes about two days. During those days, the company begins an advanced security process to verify the person’s identity.
It then employs authentication measures to ensure the person’s identity, which sparks a series of steps to get the requested bitcoins transferred from the vault to a Xapo Wallet.
This article appeared first on Cryptovest