Elliptic Teams Up with Gem to ‘Decentralize’ Private Key Storage for Multisig Wallets

Elliptic, an enterprise services company focusing on digital currency, has announced a new partnership with Bitcoin API developer Gem. Through the partnership, Elliptic will act as an independent third party and ensure the storage of clients' third private key, or backup key, for Gem's multi-signature wallet API.

The two companies are looking to set "a new security standard" and further said in a release: 

"Distributing private keys across two trusted parties, and the addition of Elliptic's insurance cover, provides clients with a higher level of security than can be achieved through a single multi-signature provider."

Micah Winkelspecht, CEO at Gem, names the collaboration as a "major leap forward for multi-signature technology," emphasizing that clients can now rely on two independent parties to secure their digital assets.

Winkelspecht argues:

"Elliptic is the most trusted name in private key storage and our tight integration means that there is no single point of failure for Gem’s multi-signature wallets."

London-based Elliptic is an accredited and insured bitcoin custodian that claims to be serving "publicly listed firms representing more than US$3 billion in market cap."

The company is widely known to have received ISAE 3402 accreditation from "Big Four" Dutch firm, KPMG, a first in the digital currency industry.

The recognition attests that Elliptic, which flagship product is its "deep cold storage," operates on the same standards as a custodian bank.

Launched during TechCrunch Disrupt in September 2014, Gem provides a full-stack API that promises to be deployable by developers in minutes. Shortly after the release of its private beta version, the startup successfully closed a US$2 million seed funding round led by First Round Capital and Tekton Ventures, to accelerate the growth of its platform.

In an interview with Cointelegraph earlier this year, Gem's newly appointed COO and former Paypal executive Ken Miller, addressed the industry's security challenges following the hack of Bitstamp, one of the major BTC exchanges.

Miller argued that the most pressing problem was the "inappropriate security with the Bitcoin wallet provider or exchange and/or vulnerabilities with the individual consumer," and further stated:

"To date, nearly one in 10 of all Bitcoins has been lost or stolen. [...] To date, Bitcoin security measures have really been the equivalent of a password, which we all know by now, is not reliable. [...] There are now technical security solutions coming to the market that would help dramatically reduce the chances of these security breaches going forward. But in order for that progress to grow roots, exchanges, wallet providers, and payment processors all need to adopt the new technology."