2024-9-18 22:45 |
Global accounting firm KPMG believes that strong custodial practices are key to boosting Bitcoin (BTC) adoption among institutions and businesses.
According to its recent report titled “The Importance of Custodians in Bitcoin Adoption and Ownership,” custodians play a crucial role in safeguarding Bitcoin holdings and are vital for the industry’s growth.
It added that custodians must ensure they have solid frameworks in place to deal with any emerging threat, as security is of the utmost importance in driving adoption.
Critical role of custodiansThe report outlined that while Bitcoin’s decentralized nature allows users to control their assets, managing cryptographic keys poses a challenge for many.
According to KPMG:
“Custodians reduced the complexity and risk of managing bitcoin holdings, making it easier for new investors.”
The firm highlighted the need for custodians to improve security frameworks and regulatory compliance to protect against internal and external threats.
KPMG identified six critical attack vectors custodians needed to address, including threats from hackers, internal fraud, and operational failures. It added that collapses like Mt. Gox and FTX resulted from weaknesses in custodial oversight, leading to billions of dollars in losses.
The report also highlighted the growing importance of custodians in supporting the rise of Bitcoin exchange-traded funds (ETFs). Bitcoin ETFs, which accumulated over $59 billion in assets under management, relied on custodians to hold underlying assets securely.
Transparency and complianceKPMG called for custodians to adopt transparent practices, such as proof-of-reserves reports and stronger operational reliability, to build trust in the system.
It stressed the importance of regulatory compliance, particularly adherence to anti-money laundering laws and oversight from agencies like the SEC and FinCEN.
The report warned that custodians must stay ahead of emerging threats, including those posed by artificial intelligence, and adapt to new challenges in the evolving Bitcoin landscape, such as Layer-2 solutions and collaborative custody models.
KPMG’s recommendations urged custodians to prioritize security, compliance, and transparency to build investor confidence and protect the integrity of the expanding digital asset market.
The post KPMG calls for stronger custodial practices to boost Bitcoin adoption appeared first on CryptoSlate.
Similar to Notcoin - Blum - Airdrops In 2024
Bitcoin (BTC) на Currencies.ru
|
