The Estonia-based blockchain monitoring platform PARSIQ and the Spanish blockchain security company Cryptonics have entered a partnership aimed at reducing the risks involved with digital assets.
PARSIQ provides real-time risk assessment and blockchain compliance solutions that allow protecting wallets and smart contracts by monitoring them for suspicious activities and automating response measures.
Cryptonics, which is a spin-off company of S2 Grupo, specializes in preventive measures, such as smart contract audits and full-stack security audits and security consulting in the design and implementation of blockchain applications.
The two companies have already been in collaboration since the inception of PARSIQ architecture and the project’s early stage in 2018. Given the strong synergies and complementary approaches, we have now decided to formalize this partnership, in order to cover the full spectrum of the blockchain security lifecycle, combining prevention with real-time monitoring and security.
Digital Asset Security
The tokenization of assets on distributed ledgers opens up new paradigms for financial interactions and allows the automation of many transactions and business processes. However, as in form a digital transformation, new risks in the form of cybersecurity vulnerabilities are introduced.
In blockchain technology, in particular, there is a conundrum in the perceived security of the cryptographic primitives employed and the number of incidents reported on a weekly basis. Essentially, cybersecurity threats in the blockchain space can be classified into four categories:
- Smart Contracts: History has shown that it is extremely difficult to get smart contracts right. Immutability, combined with transparency and the ability to manage value, are essential properties for smart contracts to be useful. However, they also convert them into ideal targets for cybercriminals, as vulnerabilities are visible to anybody and hard to fix.
- Off-chain Code: While blockchain protocols may be cryptographically secure, most of the code involved in blockchain applications that deal with digital assets, is actually traditional off-chain software and, as such, comes with the same cybersecurity risks as any piece of software. Keeping private keys secure is particularly difficult.
- Infrastructure: Blockchain applications run on common computing infrastructures, such as operating systems, networking protocols, and routers. All these components are liable to traditional cybersecurity vulnerabilities.
- Human Involvement: Finally, human end-users interact with blockchain applications and digital assets. Humans are the weakest link in cybersecurity, in that they behave in unpredictable ways. End-users, these days, are targeted by sophisticated social engineering and phishing attacks.
Considering the above threat vectors, it is no wonder that cryptographic safety is not enough to protect digital assets and blockchain security is a matter of risk management.
From Prevention to Real-time Monitoring and Risk Assessment
Both PARSIQ and Cryptonics specialize in managing risks involved in blockchain security and regulatory compliance. Whilst Cryptonics focuses on preventive measures, such as smart contract auditing, full-stack security reviews, secure blockchain application design, and development, PARSIQ focuses on real-time blockchain monitoring and workflow automation combined with blockchain transaction risk assessment.
The partnership agreement allows the two parties to cover the full security lifecycle, including prevention, incident detection, mitigation, and recovery.
