Security: The Secret Bunker for Crypto Wealth

Jochen Werne, Chief Development Officer and Chief Visionary Officer Prosegur Germany

Source: O2 Telefónica / Collage: ASBS

WIf you look at the money, it quickly becomes clear that times have changed. In all, about 1.5 billion euros were stolen in the ten biggest bank robberies. According to analytics firm Crystal, cryptocurrencies amounted to about 3.9 billion euros in 2021 alone.

Jochen Werne is not surprised. “Everything of value arouses desire.” Werne is the Chief Development Officer and Chief Visionary Officer of Prosegur Germany. He develops new services for the German subsidiary of the international security group. Prosegur Crypto GmbH offers such a service, Werne is CEO: a money storage facility for digital assets – without internet connection.

New money, new risks, new security concepts

World market security Prosegur is famous for its yellow money carriers and has grown up in the cash industry. With the boom in cryptocurrencies, the Madrid-based company faced new challenges. The goal: to be able to offer the most secure storage method in the world for cryptocurrencies. In Germany, Prosegur works with the corporate customer department of O2 Telefónica. Together, they are setting a new level of security – the highest level because billions in Bitcoin, Ethereum and other digital currencies are at stake.

Cryptocurrencies like Bitcoin or Ethereum require a new level of security

Cryptocurrencies like Bitcoin or Ethereum require a new level of security

Source: iStock / Collage: ASBS

“Our goal is to help give the new ecosystem the confidence it deserves through security components,” says Werne. “Our history is closely linked to the security of any kind of asset. Crypto Depot is a logical development of our business.”

ISLAND2 connects safes and money carriers

ISLAND2 Telefónica takes over the communication for Prosegur Germany, and that completely. Karsten Pradel, B2B director at O2 Telefónica explains: “It starts with mobile service for 3300 employees. In addition, around 1000 yellow money carriers and networked safes from Prosegur are equipped with a global SIM card from O2 Telefónica. The armored vehicles and security containers are connected directly and securely to the Prosegur company’s network The routes taken by money carriers can be documented and secured via GPS. ”

ISLAND2 also provides fast fiber optic access and ensures internal communication with VPN access (Virtual Private Network) against external access. A software-controlled data network (SD-WAN) is completely new: This enables Prosegur data traffic to be managed intelligently and quickly.

O2 Telefónica ensures communication at the highest level of security and thus helps to protect the virtual currencies

O2 Telefónica ensures communication at the highest level of security and thus helps to protect the virtual currencies

Source: iStock / Collage: ASBS

In this way, the environment on site can be secured against threats – where internet traffic originates. An intelligent component connects all communication channels and always chooses the best one. It has three benefits, says Sören Jahnke, Global Solutions Engineer at O2 Telefónica: “Lots of bandwidth at a low cost, more redundancy and thus communication security (because copper cable, fiber optics or mobile communication is used depending on availability and needs) and a better user experience because the services work better: ‘Everything runs much faster'”

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It becomes critical when people and the internet come into play

Prosegur wants to offer the ultimate crypto-deposit method. Transactions in cryptocurrencies are actually secure. Your general ledger is blockchain. The crypto money is deposited there. Blockchain is a digital document; Digital copies of this document are stored simultaneously on a large number of computers – this makes them counterfeit-proof. If a transaction is made, the chain of data contained in the document is supplemented in all copies with a data block that can never be deleted again.

But it gets critical when people and the internet come into play. Anyone who trades in cryptocurrencies needs a wallet. This is a kind of digital wallet. The wallet software, in turn, creates a digital signature and processes a transaction using the owner’s private key. This is the only way they can access and use their cryptocurrencies stored in the blockchain. “You can always track every step of what happened when and where,” says Jochen Werne.

Danger to property and people

This wallet can be made available in an app or on a computer and is usually connected to the Internet. Then you talk about a “hot wallet” – this is convenient because transactions can be made quickly but susceptible to hacker attacks. A “cold wallet” (also called “cold storage”) works without direct internet access – it can be a USB stick, for example. The form of storage of assets has two problems. First, a cold wallet can be a target for extortion or robbers, just like a gold bar or large amounts of cash stored at home. Second, cold wallets are only safe as long as they are disconnected from the Internet.

Prosegur secures crypto assets like in a spy movie - in a box without internet connection

Prosegur secures crypto assets like in a spy movie – in a box without internet connection

Source: iStock / Collage: ASBS

“Refrigerated storage is not enough for us,” says Jochen Werne. “Because having large assets under the control of one person not only endangers the assets, but also the person who controls them. Criminals not only resort to direct threats of violence against that person, but they often also threaten family members.” Prosegur Crypto therefore has a different approach: the company stores customer data in a hardware security module (HSM) .The technology works much as we would expect in a spy movie.

No chance for “Ocean’s Eleven”

“It’s a computer in a shielded military-grade case that is stored in one of our high-security facilities and is not connected to the Internet,” explains Werne. If, contrary to all expectations, such a device falls into the wrong hands, it will delete the stored data. Security protocols then ensure that the data can be reconstructed via a very complex system provided with appropriate codes. Prosegur has a number of high security facilities. The location of the crypto piles is, of course, secret.

“The entire protection is fully monitored electronically with various modules and security protocols at several levels. These are, for example, intelligent fences, where possible dangers are analyzed with artificial intelligence, ”says Werne. Even an attack like in the movie “Ocean’s Eleven” – George Clooney’s crew simply turns off the power there – would not work.

We believe we can offer the safest storage method for cryptocurrencies in the world

And yet, Prosegur customers can initiate blockchain transactions online – the following is a sophisticated process. The hardware security module connects to a computer network that enables blockchain transactions.

The technology comes from the crypto-technology company GK8; The method used here is what is known as multi-party computing (MPC). The transaction is transferred to the user’s blockchain via several security agencies using patented technology that does not require a direct connection to the Internet. This ensures the critical time of the transaction. “Everything else stays in the cold room” – most of the time the cryptocurrencies in Prosegur’s high security box without internet connection. Jochen Werne: “We believe we can offer the safest storage method for cryptocurrencies in the world. We are currently preparing to introduce this appropriately licensed service on the strictly regulated German market. “

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