Coinbase CEO Brian Armstrong Talks About Their Platform During An Interview With Jeff Roberts
Brian Armstrong, the CEO, and co-founder of Coinbase, has recently talked during an interview with Fortune’s Jeff Roberts. During the 20-minutes-long conversation, they have talked about the challenges fo the crypto industry and other issues about the crypto market.
Brian Armstrong Talks About Cryptocurrencies
Clearly, virtual currencies are a new asset class that generate several questions to investors and traders. This is why cryptocurrency-related platforms need to take security measures in order to meet the requirements of the most exigent clients and investors in the market, which is sometimes not easy to do.
According to Mr. Armstrong, the company has been working day after day in order to provide secure storage for virtual currencies. To confirm that, he said that they have the “best track record of doing that since 2012.” Indeed, several other digital platforms around the world have been hacked and users lost their funds. Meanwhile, Coinbase remains one of the most secure platforms in the space and they have even included insurance for their funds in case of an attack.
Armstrong explained which is the whole process that the company follows in order to create private keys and store users’ virtual currencies. One of the most important things behind it is randomness. It is very important to generate a secure key in a way where nobody could eavesdrop on it.
At the same time, he mentioned that they work with very unique technologies such as Faraday Cages. These are lead-shielded rooms that block electromagnetic radiation and that ensure that third-parties cannot read device data.
Moreover, exchanges have also been affected, not only by external attackers but also from inside jobs. That means that there could be an employee at Coinbase that could be stealing the digital assets month after month without the firm realizing about it. Nonetheless, Armstrong explained that they perform monthly audits in order to be sure that the funds they claim they have are in fact there.
A few days ago, Coinbase announced that they were also launching offline staking support for Proof-of-Stake (PoS) cryptocurrencies. The first digital asset to be supported by Coinbase Custody for staking is Tezos (XTZ). In the near future, MakerDAO (MKR) will also be added to the platform.
Armstrong has also explained the main difference between Proof-of-Stake and Proof-of-Work (PoW) networks and how they are able to verify transactions. He said that PoW networks verify transactions but they are not very energy efficient. At the same time, he marked that they have some issues and challenges in terms of scalability.
About PoS currencies, he commented:
“You’re actually putting up your money on which group of transactions you think will be verified next. And if you’re right, you get your money back with interest, and if you’re wrong, you lose your money. And, so that’s what’s allowing these networks to come to a consensus and verify all these transactions.”
He has also predicted that in the future, more than 50% of the cryptocurrency market will be based on Proof-of-Stake coins.