Securities token platform INX has recently announced the launch of a new wallet specifically designed for institutions, incorporating compliance features to cater to the rapidly evolving digital economy. This innovative move results from a partnership with wallet infrastructure provider BitGo, and it showcases the use of advanced multi-party computation (MPC) technology.
INX securities tokens, which exist on the Ethereum network, adhere to the ERC-1404 token standard, created in 2018 with the aim to allow compliance-friendly Ethereum tokens. These tokens can only be transferred between users who have successfully passed identity verification with a participating institution.
The introduction of the new wallet enables institutions to meet cybersecurity and custody standards within the financial sector while holding INX securities tokens. To ensure security and prevent misuse, no single individual is granted access to the private key controlling a specific account. Instead, the key is divided into three or more “shards,” which have to be combined for signing transactions – a process known as multi-party computation (MPC).
In addition to its security provisions, the wallet comes with features that simplify the management of employee access privileges. Companies can assign different roles to employees, such as “viewers, spenders, approvers, and administrators,” tailoring access according to their needs. Furthermore, institutions can separate clients’ assets by distributing funds across multiple wallets and granting “approver” privileges to individual clients. This feature enables institutions to provide their clients with more control over their accounts.
Lisa Jowett, head of platform sales at BitGo, expressed her belief that these new features will encourage institutional investors to embrace Web3 technology more comfortably. She explained that the wallets can seamlessly connect with and interact with INX without compromising security or reliability, unlocking new opportunities for investors and serving as a catalyst for institutional adoption of Web3.
On April 3, INX achieved a significant milestone by launching its first equity token from a public company, Greenbriar Capital (GEBRF). The platform’s chief business officer, Douglas Borthwick, has stated that he expects all assets will eventually migrate to the blockchain.
Despite being a registered broker-dealer with the Securities and Exchange Commission within the United States, some industry experts have expressed concerns that the country lacks clear and comprehensive crypto regulations, which could obstruct most crypto exchanges from achieving such a crucial designation. While the launch of the INX wallet is undoubtedly a step towards meeting institutional needs, it remains to be seen whether it will successfully bridge the gap between traditional finance and the digital realm.