Crypto heavyweights support new cybersecurity standards following $4 billion in losses from hacks in 2022.
Crypto heavyweights support new cybersecurity standards following $4 billion in losses from hacks in 2022.
CAT Labs Partners with Industry Giants to Combat Hacking in Crypto Space
In a move to tackle the rising threat of hacking in the cryptocurrency industry, CAT Labs, a non-profit organization founded by former Department of Justice special agent Lilita Infante, has announced a new initiative. The project has garnered support from prominent industry players, including digital asset custody provider Fireblocks, crypto fund of funds Amphibian Capital, and insurance giant Lockton.
The motivation behind the initiative stems from the increasing number of calls Infante received from investors and insurance companies concerned about cybersecurity risks in the crypto space. These concerns have often hindered collaboration between these financial entities and cryptocurrency firms. With a focus on digital asset recovery, CAT Labs frequently interacts with companies that have suffered financial losses due to hacking incidents.
While industry certifications such as SOC and ISO serve as shorthand for companies seeking funding and insurance underwriters, they offer only a baseline of cybersecurity measures. Infante recognized the limitations of these popular certifications concerning the unique vulnerabilities faced by the crypto industry. Issues like the management of private keys and multifactor authentication for transaction signing are often not adequately addressed.
To address this gap, the CryptoCurrency Certification Consortium (C4) has developed a more tailored standard known as CCSS. Major firms like Deloitte and cybersecurity company Halborn have trained as certifiers for this standard. However, CCSS adoption remains limited within the crypto industry.
Infante commented, “People have dollar signs in their eyes during the bull market.” She argued that investors did not prioritize pushing potential portfolio companies to adopt the CCSS standard when funding was abundant. However, now that the market has calmed, the industry is reflecting upon the major challenges it faces.
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While the CCSS standard may not directly tackle code exploits and protocol attacks, it plays a crucial role in mitigating risks associated with private key management. Infante hopes that the partnership with C4 will propel CCSS to become the “gold standard” for the industry. By advancing cybersecurity standards, CAT Labs seeks to attract greater participation from insurance companies and venture firms, which have traditionally been wary of crypto-related hacks. Moreover, the initiative could also assuage regulatory concerns, such as those raised by the Commodity Futures Trading Commission (CFTC), regarding cybersecurity risks in the crypto space.
Fireblocks CEO Michael Shaulov supports the initiative, stating that it will solidify the security infrastructure required for digital asset custodians, crypto hedge funds, and other businesses within the industry.
In conclusion, CAT Labs’ collaboration with prominent industry players is a significant step towards combating hacking in the cryptocurrency space. By addressing the unique vulnerabilities faced by the industry and promoting the CCSS standard, the initiative aims to strengthen cybersecurity measures, attract greater participation from financial entities, and earn the trust of regulators.
