Venture firm Two Sigma and Ethereum development studio ConSensys have invested $8 million into digital asset custody solution provider Trustology, Business Insider reports. Both investors would be joining Trustology's board of directors.
London based Trustology, known for developing the TrustVault, a crypto management service that safeguards private keys by keeping them in "tamper proof, programmable hardware security modules hosted in secure data centers, with encrypted backups in the cloud."
"Trustology's unique blend of people, process, and key management technology offer industry defining digital asset security with speed of access and unrivaled ease of use. Trustology aspires to be the digital assets brand of the future," Alex Batlin, Trustology's Founder and CEO explained in the press release.
The funding from the investors is expected to be used to create new products, support more digital assets classes and attract international customers for its services.
Joe Lubin, Founder of ConsenSys, hailed Trustology, as he believes the startup is going in the right direction.
"By prioritizing security without the need to sacrifice accessibility, Trustology will serve current digital asset holders and attract new institutional and individual investors to the space."
It's estimated that investors lost over $1 billion worth of cryptocurrency between 2012 to the second quarter of 2018, according to research firm Autonomous NEXT. Custody has been one of the challenges these past few months for cryptocurrencies, and its also seen as one of the solutions that have been holding back institutional investors. While the solution has been in existence in Wall Street for decades, in cryptocurrencies, it's an emerging trend. But one that is becoming the darling of investors.
Mike Novogratz's Galaxy Digital Ventures and Goldman Sachs placed a $15 million bet in the crypto wallet and security company BitGo Holdings in October. Coinbase launched in July, before acquiring the requisite approval from the New York State regulators, to operate as a Qualified Custodian in the state. International asset manager Fidelity Investments also announced its rollout of crypto custodial services next year.
Tom Jessop, head of its digital assets arm, Fidelity Digital Assets, went as far as to suggest that the organization might change the structure of its custodian solution to support up to five cryptocurrencies, as they continue to evaluate the demand from investors.
“I think there is demand for the next four or five in the rank of market cap order. So we will be looking at that,” Jessop remarked.