BitGo Private Blockchains: Custom Blockchain for Real-World Finance

  • Product Reviews
  • 30.10.2018 11:09 am

BitGo is a blockchain software company that offers secure storage of digital currency for institutional investors. BitGo technology provides solutions to its most difficult security, compliance, and custodial problems related to blockchain-based currencies, allowing the integration of digital currency into the global financial system. The list of BitGo’s customers includes world’s largest crypto exchanges and financial institutions, conducting over $10 billion transactions monthly.  

What is the solution?

Many application developers may begin building their applications without considering the full suite of services that will be required. As the application grows, it ends up needing more and more of these services, and the application layer is haphazardly updated to include these features in an ad-hoc manner. This process is time consuming and expensive. Building applications with the BitGo Blockchain Services enables developers to build faster and avoid these pitfalls while also enabling far stronger security and better usability. 

How does it work?

Private Blockchains is one of the company’s customizable solutions designed for managing applications like bitcoin blockchain. The company helps design, build and secure private blockchains to meet the end needs of clients. The customizable platform can be applied to any blockchain, delivering better user interface, more security, easy-to-use enterprise-grade API, and administration of the blockchain in the most efficient way. 

Source: BitGo

What is the demand for the solution?

BitGo believes that in the future many assets will be digitized and transacted on a blockchain. BitGo’s history of innovation and track record of solving the most difficult technical, security and compliance problems associated with blockchains uniquely positions itself to help clients create a solution that works for them in the real world. Many blockchain companies do proofs-of-concept. BitGo moves beyond proof-of-concept into design, development, and delivery of real-world applications. It approaches private blockchain construction in pursuit of the same end goal that has guided our work on public blockchains: making digital currencies function as mature systems with enterprise-scale tools.

Key Components

The BitGo Blockchain Services evolved from real world lessons in security and scalability when deploying blockchain solutions. Applications built atop the services layer benefit from this built-in security and scalability via a simplified API, enabling faster and higher quality development. 

  • Indexing and Notification Services

The blockchain foundation processes the global transaction ledger used within the blockchain. While blockchain administrators are interested in the global state of the blocks and transactions, most users only care about transactions relating to themselves. Indexing services enable fast querying and organization of blockchain data, allowing users to quickly find their own transactions without needing to worry about all other data. Depending on the application, indexing can either be focused to a small set of the overall data or to the entire system.

  • Key Management

Creating and storing keys may be the most critical element of security in cryptography. Others can easily create poorly chosen keys, and keys that are not stored properly can be stolen. To keep keys secure they must be safely provisioned and a definitive chain-of-custody must be understood at all times. Unfortunately, because keys can be easily stolen electronically, keys must always be stored in encrypted forms, and users are notoriously bad at maintaining strong passwords and remembering them. As such, much of the key management problem becomes a usability problem - how to strongly create, encrypt, and store passwords while providing failsafe mechanisms in case of human error. The BitGo platform solves these problems by use of multiple users, multiple keys, as well as storing keys encrypted in different forms.

  • Multi-Sig Cosigning

Securing today’s online data is harder than ever, and no industry needs multi-signature security more than digital assets. Without multi-signature services, digital asset security suffers from a single-point of attack. If you secure your keys on your client, and your client is hacked, then you lose your digital asset; conversely, if you secure your keys in a service, and your service is hacked, then you lose your digital asset. Multi-signature technology radically reduces the risk of theft by forcing attackers to breach multiple, distinct systems. But with BitGo’s unique multi-signature security designs, are protected from many other vectors as well: coercion, forgotten passwords, lost keys, asset seizure, insider-theft, malware, death, and data loss (e.g. hard disk crashes).

  • Policy & Security

While the blockchain foundation layer provides the basic logic to cryptographically protect your assets, blockchains today know nothing about people. For example, many businesses have multiple users of a single account, each with different roles. A CFO, for example, may have full privileges in the account, while a controller may have very few. The BitGo Policy Engine enforces the human aspects of digital asset account security. For example, transactions larger than a certain size may require two people to authorize the transaction; or a particular account may be configured to only send assets to a particular set of other accounts so that attackers cannot force theft of funds to a foreign account.

  • Accounts & Balances

The Wallet Service on top of the blockchain foundation organizes blockchain transaction data into logical wallets (or accounts), allowing you to easily create, configure, and use digital asset accounts that resemble a bank account. Using the wallet service, applications can easily add metadata to transactions and wallets for use with auditing and data sharing between users of the wallet. Finally, as the number of transactions in a wallet grows large, the wallet service helps manage the assets by intelligently combining and splitting the assets for easy, fast transactions.

  • Identity Services

Blockchains, in their current form, evolved primarily from cryptography. The mathematics behind these blockchains ensure utmost security of the digital assets they protect. However, the cryptographic keys that enable these protections are unidentifiable by themselves. BitGo’s platform combines a unique legal and technical foundation whereby keys can be identified within the platform, while retaining full privacy of the holder. The identity service enables blockchain applications to benefit from the security of cryptography while also maintaining regulatory and risk compliance needed when interacting between people.

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