Redefining Digital Asset Custody: Summary from the Cobo Portal Launch
August 08, 2024
Cobo Portal Launch Event: Unveiling WaaS 2.0 and Cobo Portal Apps
On July 17, Cobo introduced the Cobo Portal at Singapore's Westin Hotel. The event showcased key features of Cobo Portal, WaaS 2.0, and the new Cobo Portal Apps.
The event was divided into four main segments:
Keynote on market developments and future of cryptographic key management by Discus Fish, Co-founder and CEO of Cobo
Keynote on Cobo Portal by Dr. Jiang Changhao, Co-founder and CTO of Cobo
Panel 1: Building the Next-Generation Custody Ecosystem
Panel 2: Unlocking the Crypto Bull Cycle - Trends and Innovations
We've compiled the most exciting highlights from the event to share with our community.
Discus Fish: From Vision to Reality
Key Highlights
The evolution from Cobo Custody to Cobo Portal was a transformative upgrade driven by user feedback and forward looking trends.
Serving over 500 institutions, Cobo has tripled its assets under custody in 2024.
2024 Crypto industry snapshot
Global crypto adoption reaches 15%.
Convergence of TradFi and DeFi with Bitcoin ETF bringing in over $10 billion USD.
Bitcoin ecosystem is evolving with the rise of CeDeFi solutions and BTC L2 solutions.
Security and key management remains a challenge despite blockchain performance improvements, with over $2 billion USD lost in hacks in 2023.
Cobo Portal integrates 4 wallet technologies into a single platform, featuring multi-layered private key protection, advanced risk controls, and seamless integration between both CeFi and DeFi ecosystems.
Dr. Changhao Jiang：Building the future of Crypto Custody
Key Highlights
Cobo Portal is a major upgrade, offering a one-stop digital asset custody and management platform.
Cobo Portal offers:
A unified interface for custodial, MPC, smart contract, and exchange wallets
Comprehensive data dashboard
Flexible risk control capabilities
Optimized developer experience
As the first platform to integrate these four wallet technologies, Cobo Portal provides a unique on-chain risk control solution.
Cobo Portal's WaaS 2.0 features:
Unified API interface
Multiple authentication methods (OAuth 2.0, API key)
Webhook and callback mechanisms
Standard RESTful API and Open API specifications
Developer console with:
Data visualization
API key configuration
Webhook debugging
Cobo Portal Apps
Cobo Portal Apps — Cobo’s new app store that offers an integrated and vetted list of apps that enhances business operations and accelerates development. The following app services available now are:
Fund Mirroring (SuperLoop)
Staking
Invoicing
Payroll Distribution
Business Reporting
Panel 1: Next Generation Custody – Building an Ecosystem
Our first panel brought together industry leaders to discuss the evolving landscape of crypto custody solutions. The panel featured:
Dr. Changhao Jiang, Cobo Co-founder and CTO
Yan Shan Tan, Figment APAC Lead
Hao Chen, Legend Trading Founder and CEO
Peter Wang, 57Blocks Founder and CEO
Key topics included:
Challenges in current custody solutions
Cobo Portal developments and benefits
How partners utilize Cobo Portal to address institutional client needs
Question #1: What are the challenges in current custody solutions?
Response from Figment (Yan Shan Tan)
Although Figment provides non-custodial staking services, they partnered with Cobo, recognizing the significance of secure custody prior to staking. This collaboration enables Figment clients to access secure custody.
Institutional clients require a delicate balance between the security of third-party custody and the speed and utility of MPC Wallets. Cobo offers a unified platform that addresses this need, providing the flexibility to allocate assets according to customer requirements.
With the continuous emergence of new public blockchains, there is a growing need for a unified wallet infrastructure capable of supporting multiple chains.
Custody is often perceived as a cost. By offering value-added services such as trading, payments, or staking, custody providers can offset these costs. Figment's staking service is a prime example, benefiting both clients through increased returns and custodial service providers through new revenue streams.
Response from Legend Trading (Hao Chen)
Legend Trading, a technology-driven startup originating from Silicon Valley, has selected Cobo Portal as the base infrastructure for its business.
As a major OTC platform, Legend Trading relies on Cobo to ensure the security of large-scale funds.
Legend Pay provides fiat on/off ramp services for 25 exchanges. Cobo's automated system guarantees efficient operations.
Cobo supports Legend Trading's granular risk controls, governance and workflows meeting its organizational needs.
Cobo supports Legend Trading’s USDC transactions across various networks (Ethereum, Polygon, Optimism) in partnership with Circle.
Cobo provides underlying support for Legend Trading's Stella Pay wallet, facilitating the development of financial products such as tokenized US Treasury bills.
Cobo's comprehensive audit log function helps Legend Trading meet the stringent financial regulatory requirements of Europe and the United States.
Question #2 : What key improvements does Cobo Portal upgrade offer beyond secure custody, and what industry challenges does it address?
Response from Dr. Changhao Jiang
By serving a diverse user base, Cobo naturally understands how to provide secure and user-friendly custody wallet infrastructure.
In this process, we identified three key challenges:
the rapid development of blockchain technology,
the diversity of user types and needs, and
adapting to various use cases.
To address these challenges, Cobo aims to:
Abstract the complexity of blockchain, offering intuitive, simple, and secure wallet solutions.
Leverage years of experience to distill the needs and solve problems at a framework level.
Provide a scalable framework to accommodate different application scenarios and user types.
The Cobo Portal upgrade is designed to achieve these goals, offering more flexible adaptability while maintaining security.
Question #3: Why is Cobo developing an application ecosystem like Cobo Portal Apps, and how does this benefit Cobo users?
Response from Dr. Changhao Jiang
While private key and fund security are core to custody services, they are not enough by itself. User needs are diverse and constantly changing, on top of the industry continuing its innovation. For this reason, Cobo has introduced an application platform model, using security and risk control as its base layer. On top of this layer, we provide a flexible and scalable application framework which can adapt to a multitude of users and use cases. Users can customize based on specific needs and adjust it to serve different use cases. This model not only meets current needs but also accommodates the evolving industry landscape.
Question #4: What pain points does Figment plan to address for institutional clients in its collaboration with Cobo Portal?
Response from Figment (Yan Shan Tan)
Figment has developed a staking application within Cobo Portal, allowing Cobo clients to stake directly from their wallets to Figment nodes and earn higher returns. Unlike lending, DeFi, or trading, staking does not require the transfer of assets, reducing third-party risk. The non-custodial model keeps assets securely stored in Cobo wallets. The primary risk is forfeiture risk, but Figment has a comprehensive risk management mechanism in place:
Failover procedures
Monitoring systems
Incident response systems
Question #5: Does Legend Trading have plans for building within Cobo Portal Apps?
Response from Legend Trading (Hao Chen)
Legend Trading plans to provide services for institutional users through Cobo Portal, including:
Developing an OTC trading application integrated into Cobo Portal, allowing institutional users to easily transact fiat and cryptocurrency.
For compliance reasons, currencies will be categorized into two tiers and serviced by different entities.
Launching the Stella card, making it easier for Cobo’s institutional users to issue cards for employee business expenses.
Offering tokenized U.S. short-term Treasury products, providing investment options for idle stablecoins in Cobo wallets.
Question #6: Can you share examples of how you used Cobo to solve specific business challenges or address tooling issues?
Response from 57 Blocks (Peter Wang)
We have three products made for different user needs, and all of them use Cobo Portal’s 4 wallet technologies, 1 unified platform solution. which highlights the flexibility and adaptability of Cobo’s wallet solutions.
Upmarket: Alternative Investment Platform for Traditional Financial Investors
Targets accredited investors with options such as Pre-IPO, real estate, and hedge funds.
Plans to integrate cryptocurrency custody services.
Consider using a custodial wallet for better user experience.
Token Pad: Multi-Chain Asset Portfolio Management Mobile App
Aimed at crypto-native users.
Plans to integrate an MPC wallet
Self-Developed Yield Fund:
Designed specifically for fund managers and traders.
Plans to use smart contract wallets.
Panel 2: Navigating the Crypto Bull Cycle – Trends and Innovation
Our second panel featured industry leaders discussing key trends in the current cycle.
Shenyu, Cobo Co-founder and CEO
Chen Lin, Deribit Asia Pacific Business Director
Dong Xinshu, Babylon Chief Strategy Officer
Ryan Chow, Solv Protocol Founder and CEO
The discussion covered:
Contrasting needs of traditional vs. crypto-native institutions
Unique trading patterns in crypto
Potential arbitrage and yield opportunities as crypto markets approach historic highs
The panel explored how these factors are shaping the landscape of crypto.
Question #1: How does the launch of the BTC ETF impact your business?
Response from Discus Fish
BTC ETF listing is akin to Bitcoin's 'IPO', attracting traditional finance
Large institutional funds are still entering the market
High-net-worth institutions prefer standardized asset management products
Increasing compliant assets drive demand for third-party custody providers
Response from Deribit (Lin Chen)
Compliance is now essential in the exchange industry
Deribit obtained a Dubai license covering spot, derivatives, and options trading
Stricter compliance (e.g., enhanced KYC) indicates industry maturation
Benefits include improved fund security and attraction of mature partners
Collaborating with Cobo to enhance customer fund protection and segregation
These measures support the current bull market and push the industry towards greater regulation and security
Response from Babylon (Xinshu Dong)
Impact of Bitcoin ETFs on the Crypto Industry
Bitcoin ETF marks a milestone for mainstream crypto adoption
Challenges the industry to develop more practical use cases for Bitcoin
Current regulatory restrictions (e.g., no direct staking) are temporary
Enhanced custody and security measures are key to building regulatory confidence
Response from Solv (Ryan Chow)
BTC ETFs impact both regulatory channels and the secure storage of assets
Regulatory channels have attracted ~$60 billion in inflows
Short-term competition between TradFi and crypto market leads to decreased capital efficiency as Bitcoin from BTC ETF is locked away and cannot be used
Long-term positive outlook for BTC ETFs
Potential for tokenizing BTC ETFs, creating new on-chain assets
Tokenized BTC ETFs could emerge in 1-2 years, similar to tokenized government bonds
Tokenized BTC ETF could add $60 billion in assets to the crypto ecosystem without affecting underlying Bitcoin storage
Question #2: What innovations have emerged from this bull market?
Response from Babylon (Xinshu Dong)
Bitcoin-focused innovations dominate, but face practical application challenges.
For example:
Babylon's use of Bitcoin scripts
BitVM's Turing-complete program verification
These developments need time to mature for real-world applications
Response from Solv (Ryan Chow)
This cycle's tech innovations are on par with previous ones, including:
Zero-knowledge proofs (ZK)
Bitcoin code progress
Improved cross-chain capabilities
Future outlook:
Potential for more Bitcoin yield-based asset innovations
Wrapping of staking and restaking rewards into liquidity tokens
Question #3: Can you share some arbitrage or yield opportunities?
Response from Solv (Ryan Chow)
Bitcoin yield opportunities fall into three main categories:
Staking/Restaking (e.g., Babylon, Botanix)
Trading strategies consist of CeFi: Options and arbitrage, DeFi: Neutral strategies
Platform ecosystem airdrops
Key points:
Babylon has received attention for its Bitcoin yield rates
DeFi's role in Bitcoin yield is growing
Solv-GMX collaboration on GMX offers 10-15% annualized returns
Partnerships with Ethena, GMX, and Babylon provide diverse yield opportunities
Solv users can access liquidity yield tokens (SOLBTC, SOLBTC.BBN) for mining, lending, and trading
Response from Babylon (Xinshu Dong)
Babylon’s flexible staking model, allowing returns in various assets
Liquid staking protocols (SOF, Lombard, Bedrock) provides more flexibility
Users can maintain BTC liquidity while participating in Babylon
Opens up more DeFi yield opportunities in the Bitcoin ecosystem
Response from Deribit (Lin Chen)
For Token Holders:
Allocate Bitcoin to Cobo custody:
Sell call options on Deribit (~10% annualized return)
Stake in Babylon or Solv projects for low-risk returns
Benefit from Cobo's custody wallet security when trading on Deribit
For Non-Token Holders:
Gradually build Bitcoin position by selling put options based on market fluctuations
Aim to complete position before October
Cobo's custody and SuperLoop off-exchange settlement enhance overall digital asset security.
Response from Discus Fish
This year's major yield opportunities come from three areas:
Staking and restaking, such as Babylon and Eigenlayer, have attracted a large amount of TVL.
Securitization of internet native yield sources, such as Ethena products
Traditional on-chain arbitrage opportunities, including arbitrage between centralized and decentralized exchanges and low-risk DeFi arbitrage.
The first half of the year saw good performance in Bitcoin-native yields, and the second half may bring more Bitcoin-native yield opportunities due to Babylon. New derivatives like PT/YT provide more options for locking in current yields.
Cobo Portal Redefines Digital Asset Custody
The launch of Cobo Portal marks the beginning of a new era in digital asset custody. Cobo will continue to lead the way and bring more innovation to the industry.
