Coinbase, one of the most-used cryptocurrency exchanges, moved approximately $5 billion in cryptocurrency, claiming the title of “largest crypto migration on record.” The transfer included 5 percent of all BTC, 8 percent of all ETH, and 25 percent of all LTC in circulation.
According to a blog post on Dec. 19th, Coinbase announced that it successfully made one of the largest cryptocurrency transfers in history. According to the company, the transfer emphasizes Coinbase’s commitment to security:
“Our most critical responsibility is the security of the assets that our customers entrust to us. The gold standard of cryptocurrency asset security is offline, or “cold” asset storage. Coinbase stores 98% or more of our customer assets in our cold storage system.”
Coinbase Upgrades Cold Storage Technology
The reason for the transfer is because Coinbase is moving to “fourth generation” systems. The “next generation” system uses a “highly controlled” key generation process and a “globally distributed” system for storing secret keys and approving transactions.
This cold storage system, according to the post, prevents the problem of lost keys, “misuse” by bad actors (including “insider threats”) while providing regular audits. The aim is to ensure security, while providing the best possible storage options for all asset classes:
“…we can store any cryptocurrency using the same system, without making compromises in the level of security provided to any single cryptocurrency.”
Coinbase balanced these concerns with its need for secrecy, attempting to conceal from hackers without sparking a market panic. Coinbase alleviated these fears by issuing a short blog post prior to the move, allowing the move to happen without giving excessive time for hackers to mobilize their resources.
Preparation for Roll-Out
Coinbase had been preparing “months before the actual move date,” which involved most of Coinbase’s staff. The move required a total of four days and was completed without issue.
The move marks another triumph for Coinbase amidst a spree of heavy-hitting features. Within the last month, Coinbase has introduced an OTC desk, added a dozen new ERC-20 tokens on Coinbase Pro, and integrated free PayPal withdrawals into its service.
In addition to these feats, Coinbase has announced that the transfer is “pushing the pace” of industry security. The blog closed with a job offer for those interested in challenging the crypto-exchange status quo.
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Eric Moos is based out of Portland, Oregon. For the past decade he has taught English at a university in South Korea. He has recently taken a break from teaching to pursue his interest in blockchain technology. Aside from teaching, writing, and editing for blockchain publications, Eric enjoys writing short fiction, doing anything outdoors, and travelling.