The crypto custody arm of major United States-based cryptocurrency exchange Coinbase, Coinbase Custody, obtained two new security evaluations.

According to a press release published on Feb. 12, Coinbase Custody was granted a Service System Control (SOC) 1 Type 2 and a SOC 2 Blazon 2 report by major accounting business firm Grant Thornton.

System Organization Command reports

In obtaining the reports, Coinbase Custody is able to prove to clients that they are compliant with a variety of security and reporting standards.

Co-ordinate to Grant Thornton'southward website, SOC reports are meant to provide information on "the existence and strength of fiscal, operational and information security controls in an organisation." An SOC 1 study provides data on the internal controls relevant to a user organization's fiscal reporting. In other words, "SOC 1 reports are intended to be auditor to auditor communications."

SOC two reports, on the other hand, provide information on "security, availability, processing integrity, confidentiality and privacy." Both SOC 1 and SOC ii reports are divided into Blazon ane and Type two. A Type ane study describes the design of the controls, while a Blazon 2 report also covers their effectiveness later on a minimum testing flow of six months.

Coinbase Custody besides states that information technology will renew the reports in the futurity. The proclamation follows late January reports that Coinbase has established an entity in Ireland to expand its crypto custody services to European institutions.

Other cryptocurrency services have likewise sought out SOC certificates. Equally Cointelegraph reported in late January, U.South.-based crypto exchange and custodian Gemini has completed a SOC 2 Type 2 evaluation through global professional services firm Deloitte.

The purpose of cryptocurrency custody

While one of the biggest advantages of crypto assets is the ability to independently custody them, fiscal markets and institutional investors need a heightened security standard that can hardly exist achieved with cocky-custody. Blockchain Zoo researcher Rohan Barde Hai explained in belatedly September 2022 why custody solutions are of import to institutional investors in a Cointelegraph opinion slice.

The maturing cryptocurrency market is also manifestly bringing traditional institutions onboard. On the heels of new Anti-Money Laundering laws, 40 High german banks requested the regulators' get-ahead to offer digital asset custody services.