Cointelegraph spoke to Anchorage co-founder and president Diogo Monica about his opinion on the impact of the rise in decentralized finance (DeFi) on the cryptocurrency custody sector.
Monica explained that the increasing complexity of DeFi “reveals the shortcomings of the cold store and manual human operations”.
The President of Anchorage stressed the additional risks posed by the multitude of measures in the chain required in many DeFi protocols, saying: “In our support for MKR governance, executive voting and surveys, we see what customers want and often need to participate in chain activities.”
“As new and emerging protocols increasingly require this type of active use of private keys, some custodians have to rely more on untested smart contracts, which can jeopardize client assets.”
Institutes call for engagement in DeFi
Monica said Anchorage noticed the institutional demand for DeFi and said, “Our institutional clients want to invest in a range of digital assets, including new DeFi projects and stablecoins“”
“Anchorage’s mission is to increase institutional engagement in the crypto space, and DeFi is currently home to many of the most exciting innovations,” he said.
Efficiency of the distributed custody system reinforced by COVID-19
The Anchorage co-founder explained this The company’s distributed processes have proven particularly useful in the context of the coronavirus pandemic.
“Anchorage does not rely on manual human operations, nor does it require access to physical safes or safes, unlike custodians that use cold rooms.”he explained, adding:
“This differentiation point is particularly important during the current pandemic: our solution works as it should, even though our workforce is fully distributed, while other solutions depend on people physically getting to a safe place where key private materials are kept.” “
Anchorage supports upcoming tokens
Anchorage recently announced support for the Compound Governance Token (COMP), the fifth pending crypto asset to be supported by Anchorage, including TrustToken and Celo.
“Anchorage is always striving to support new cryptocurrencies that are in demand from our customers.”Said Monica.