Coinbase Makes ‘Record’ Transfers of BTC, ETH, and LTC to Cold Storage 🚨 This article is 6 years old...
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Coinbase Makes ‘Record’ Transfers of BTC, ETH, and LTC to Cold Storage
2 min read
Updated: Nov. 7, 2019 at 5:59 am UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
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.”
Understandably, such a huge move of assets might spark concerns from twitter watchdogs about a sell-off, an “exchange breach,” or raise fears of price manipulation by ‘whales.’
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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Ethereum
$3,338.32
Ethereum is a decentralized, open-source blockchain platform that enables the creation of smart contracts and decentralized applications (DApps).
Litecoin
$88.7220
Litecoin is a peer-to-peer Internet currency that enables instant, near-zero cost payments to anyone in the world.
Bitcoin
$97,595.91
Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Coinbase
Coinbase is a digital currency exchange and wallet service that allows individuals to buy, sell, and store digital currencies, such as Bitcoin, Ethereum, and Litecoin.