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Kraken and major industry players have jointly founded the non-profit organization Blockchain Security Standards Council
The Kraken announced that it has co-founded the Blockchain Security Standards Council (BSSC) along with other major industry players to improve security in the cryptocurrency industry.
Other co-founders include Digital anchoring, Monetary base, Fire blocksBastion, Figment, Halborn, OpenZeppelin, Ribbit Capital and Sentinel Global.
Consensus-based security
The non-profit organization aims to create uniform security standards across the cryptocurrency industry, addressing the most pressing security threats, such as fraud, nation-state cyberattacks, and protocol exploitation.
The council’s mission is to develop consensus-based security benchmarks and a robust audit process by the end of 2024. These efforts are expected to strengthen the industry’s security framework and increase trust in digital assets.
Nick Percoco, Kraken’s Chief Security Officer, emphasized the importance of these initiatives, stating:
“Voluntary security standards are crucial to the maturation of the cryptocurrency industry. Collaborative efforts among industry players to strengthen the overall ecosystem will increase trust in cryptoassets. Kraken is proud to contribute to the development of these essential standards.”
The BSSC also plans to engage with regulators and policy makers to ensure the development of balanced and effective security standards. This proactive engagement aims to protect consumers while fostering innovation within the blockchain ecosystem.
Kraken’s involvement in the BSSC reflects its ongoing commitment to security, following its role in establishing the Crypto Information Sharing and Analysis Center (ISAC). The ISAC facilitates the sharing of knowledge and best practices in the cryptocurrency industry, with the goal of reducing cybersecurity risks and improving the overall resilience of the industry.
The formation of the BSSC is seen as a significant step towards solving the blockchain trilemma, which involves balancing decentralization, security, and scalability. By focusing on security standards, the BSSC aims to mitigate risks while supporting the growth and scalability of blockchain networks.
White Hat Drama
The move comes in the wake of the recent dispute between Kraken and blockchain security firm CertiK.
In June, the exchange encountered a major security challenge when blockchain security firm CertiK discovered a critical vulnerability in its system. This flaw allowed attackers to initiate deposits and receive funds without completing the deposit process, effectively allowing assets to be created out of thin air.
CertiK exploited this vulnerability to withdraw $3 million from Kraken accounts, leading many to argue that the withdrawals were too large for testing purposes.
Kraken also accused CertiK of extortion, claiming that the firm demanded payment for the return of funds, deviating from standard bug bounty protocols. The exchange criticized CertiK’s approach, claiming that held the funds hostage and behaved in an unprofessional manner.
However, CertiK denied any malicious intent, saying its actions were preemptive and aimed at protecting the platform. It argued that Kraken’s threats against CertiK employees were unjustified and noted that it had offered to return the funds, but the exchange had not provided a wallet address.
The dispute was resolved after both companies made their positions public and CertiK returned the funds to the addresses he had available.