Blockchain Board of Derivatives (bbod.io) launches in July with a solution to the most fundamental problem in crypto trading–security.
The move is coming amid multimillion-pound hacking attacks on cryptocurrency trading platforms. After hackers stole £390 million worth of crypto funds from Tokyo-based cryptocurrency exchange Coincheck in January, security concerns in the crypto community have been on the rise. This raises the question: Who has control over a trader's crypto funds?
Many cryptocurrency exchanges use centralized wallet systems which cause traders to lose control of their funds and expose them to security threats. However, Blockchain Board of Derivatives, launching in July, uses a decentralized wallet system
Is a software or program which stores our public and private keys and allows us to send and receive #Cryptos by interacting with several #blockchain networks. #BBOD Crypto University is coming soon with unbiased and quality content.https://t.co/xgIJIxG1TY pic.twitter.com/X6t7X5lEi7
— BBOD (@BBODTrading) July 9, 2018
Decentralized Wallet System To The Rescue
The decentralized wallet system enables traders to create their own cryptocurrency wallets designated specifically for trading. This keeps traders in control of their crypto funds throughout the entire trade, thus significantly enhancing trading security. Simultaneously, the trading platform reserves the limited right to settle trades daily.
The trading platform's custody operates via a system of smart contracts on the Ethereum blockchain, that handle the flow of capital, protect the profits from the winning side of the trade and transfer transaction fees. This prevents excessive access to clients' funds and eliminates the opportunity for theft, even from the inside. The smart contract system, just like the blockchain, is trustless. This means that the trader does not have to trust the trading platform in order to be sure that his or her money is safe.
By encoding the deposit and withdrawal rules, along with the limits, the board is making sure the exchange is never in a compromised state, said Chief Technology Officer Chris Urbanowicz. There is no single point of trust – neither on the side of the contract creator nor the exchange. Thanks to a heartbeat mechanism, customers have an option to retrieve their funds if the exchange ceases operations, he added.
Apart from providing traders with enhanced security, the trading platform follows a hybrid model. It integrates its decentralized wallet system with industrial grade infrastructure that processes upwards of 1,250,000 messages per second with a latency of fewer than 25 microseconds. This provides crypto traders with safe and secure transactions, settled in Ethereum, at high speeds.