Bitfinex Teams Up with BitGo to Offer World’s First ‘Proof of Reserve’ Bitcoin Exchange

Bitfinex and BitGo developed the most secure bitcoin wallet based on multi-signature technology.

Photo: Bitfinex

Photo: Bitfinex

Partnership of Bitfinex and BitGo has resulted in reaching a new higher level of bitcoin wallet security. Using BitGo’s unique multi-signature technology Bitfinex now offers customers personal wallets thus allowing them to control their funds on the blockchain while preserving institutional-level security.

Bitfinex heads the list of world’s bitcoin exchanges. Its trading platform is considered to be the best in cryptocurrency sphere. The company admits that a strong team of financial experts and their passion to bitcoin helped it to develop the largest and most reliable platform.

BitGo is well-known in the sphere of bitcoin security. The company got $14 million of investments from Silicon Valley venture capitalists and entrepreneurs. In 2013 it launched BitGo Enterprise, the first multi-signature wallet, and BitGo Platform, a suite of services and tools to access the wallet. Although already successful it didn’t stop and continue entering new levels of bitcoin security.

BitGo explains that it used to be typical for bitcoin wallet to have only one key. Multi-signature technology offers three keys for a wallet: one is controlled by BitGo itself, the second one – by a customer and the third key is stored offline as a backup. Thus even if one key is endangered, a client’s wallet is still safe. The technology makes bitcoin wallets hack proof.

Before the collaboration Bitfinex used to offer customers security via a shared pool which actually looks like offering one key for all safe-deposit boxes. Now each customer owns a unique set of keys and can keep an eye on his/her bitcoin funds on the blockchain. The process becomes similar to gold exchange allowing almost-real-time verification of bitcoin balances.

The cooperation of Bitfinex and BitGo seems to be promising and mutually rewarding. Mike Belshe, BitGo CEO, shares first impression: “We’ve been working with Bitfinex for several months and are impressed by their dedication to security for their users. The industry has been clamoring for exchanges to adopt the multi-sig model, and we’re proud that Bitfinex selected BitGo’s platform to do it”.

Bitfinex echoes and persuades that this level of wallet security was something bitcoin industry needed: “The trading community has long sought individually verifiable accounts without sacrificing security or performance.

With the help of BitGo’s multi-signature technology, the Bitfinex team is very excited to be the first exchange in the world to automate Bitcoin settlements using ‘On-Blockchain’ customer segregated wallets” – Zane Tackett, Director of Community & Product Development at Bitfinex.

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