Arthit Sriumporn, the CEO of Rakkar Digital, a leading digital asset custodian, provides valuable insights into the current landscape of crypto custody and the efforts made by custodian platforms to streamline their operations amidst regulatory challenges. With his extensive experience in banking and finance, Arthit is committed to offering secure and easily accessible custodian solutions to address customer challenges. In this interview with TheNewsCrypto, he discusses the adoption of crypto by banks and financial institutions, the role of qualified custodians in safeguarding user funds, and the measures taken to ensure user security against scams and data breaches. Arthit also shares his perspectives on the integration of multi-party computation (MPC) technology and the pros and cons of Central Bank Digital Currencies (CBDCs).

The Role of Qualified Custodians in Crypto

Arthit Sriumporn highlights the importance of qualified custodians in the crypto custody market. Unlike platforms that offer self-custody solutions, qualified custodians like Rakkar Digital follow regulatory frameworks and implement measures such as anti-money laundering procedures and know your customer rules. By holding the private keys on behalf of customers, qualified custodians assume the liability for safeguarding user funds, emphasizing trust and security. This segregation of controls mitigates the risks associated with holding all assets in one place, as exemplified by the recent incident involving FTX.

Addressing Security Concerns

Custodians play a crucial role in ensuring the security of user funds in the face of increasing scams, heists, and data breaches. Arthit Sriumporn emphasizes the significance of trust and security as the foundation of custodian platforms. While exchanges focus on market match trading, custodians specialize in safeguarding assets. By utilizing third-party custodians, digital asset operators can defer the risk associated with self-custody and minimize on-chain risks. Arthit also acknowledges the need for adequate governance measures when integrating third-party custodian tools for digital assets such as non-fungible tokens (NFTs). While NFT support is part of Rakkar Digital’s roadmap, the company is currently focusing on secure custodianship for digital assets.

Enhancing Security with Multi-Party Computation (MPC) Technology

Arthit Sriumporn highlights the use of multi-party computation (MPC) technology in enhancing the security of users’ private keys. Rakkar Digital leverages Fireblocks technology, which employs MPC to divide keys into encrypted key shards and stores them on different servers. This approach ensures that the private keys remain secure even if unauthorized access is gained to individual servers. By utilizing cold wallets and offline signing devices, custodians like Rakkar Digital maintain a high level of security. The integration of MPC technology adds an extra layer of protection against potential hacking attempts, safeguarding users’ digital assets.

Pros and Cons of Central Bank Digital Currencies (CBDCs)

Arthit Sriumporn discusses the implementation of Central Bank Digital Currencies (CBDCs) and their potential use cases. While CBDCs offer increased flexibility and can facilitate cross-border remittances and payments, there are concerns regarding central bank and jurisdictional control over these digital currencies. The electronic nature of CBDCs and the potential influence of governing bodies can raise apprehension among individuals. Arthit emphasizes the need for a clear regulatory environment to avoid uncertainties that could lead to legal consequences. In Southeast Asia and Hong Kong, where Rakkar Digital operates, regulatory frameworks for digital assets are relatively clearer compared to the variable interest rates and uncertainties present in the United States. Clarity in regulations enables businesses to understand the boundaries and operate with confidence.

Conclusion

Arthit Sriumporn, CEO of Rakkar Digital, sheds light on the evolving landscape of crypto custody and the challenges faced by custodian platforms in the current regulatory environment. Qualified custodians, such as Rakkar Digital, play a crucial role in safeguarding user funds and ensuring compliance with regulatory frameworks. The integration of multi-party computation (MPC) technology enhances the security of users’ private keys, while the pros and cons of Central Bank Digital Currencies (CBDCs) are carefully examined. As the crypto industry continues to evolve, the efforts of custodian platforms like Rakkar Digital are instrumental in regaining trust and fostering a secure environment for users’ digital assets.