VersaBank, a technology-based and all-digital Canadian Schedule I chartered bank, is developing a super high-tech “Blockchain-based digital safety deposit box” for cryptocurrencies and other digital assets.
Last week, the firm announced the hiring of Gurpreet Sahota as Chief Architect of Cyber Security, a former Principal Architect of Cyber Security at BlackBerry Limited, to supervise a team of engineers in developing a novel Blockchain based digital safety deposit box, known as the VersaVault. The service will be available by June and will serve as a means to store cryptocurrencies, according to the company’s latest press release.
VersaBank describes the VersaVault as the “world’s first blockchain-based safety deposit box,” which will soon be available on a global scale. It is common that physical assets such as precious metals be stored in Switzerland, Hong Kong, and even Singapore, but when it comes to digital assets, could the country of choice now be Canada?
Your digital assets are just as valuable as any family jewelry, property deed or stock certificate, but protecting them isn’t nearly as simple. No storage device or commercial cloud service is completely safe, and most blockchain-based secure storage is only for crypto-currency… and offered by companies you’ve never heard of, in places you don’t know. VersaVault is the solution your digital wealth has been waiting for: the impenetrable security and absolute privacy of blockchain encryption, created and managed by a chartered bank in one of the world’s most trusted financial markets. Like a safety deposit box, only you have access to what’s inside, and like a safety deposit box, it’s been built by an institution you can trust to be there for the long run.
President and CEO David Taylor has positioned the bank to become a global leader in digital asset security from the perspective of safety, who highlights the latest cybersecurity challenges in cryptocurrencies has yet to be resolved.
Last month, Coincheck, a Japanese cryptocurrency exchange, told financial authorities that it had lost 500 million NEM cryptocurrency coin, which at January 26 exchange rate amounted to roughly $400 million. By far, this was the most significant crypto theft in history.
“We’re using what banks are all about — safety and security — only what we’re doing now is saying that physical box in the basement is getting obsolete,” Taylor said in an interview at Bloomberg’s Toronto office. “Most people’s really valuable assets are contained in some sort of digital format, whether it be a deed or a contract or a cryptocurrency.”
“Our differentiator in this market is to be secure and super private,” added Taylor, 65. “The bank wouldn’t have any kind of back door to open up the vault, we’re just providing the facility that folks could put their digital keys in.”
Taylor said large financial institutions are showing interest in storing their digital assets in VersaVault since the company’s latest press release. He told Bloomberg that pricing has yet to be released, but he did indicate that it will be expensive.
Bloomberg notes that VersaBank is an early mover in the digital asset security space. However, VersaBank is not alone in the space with firms in Asia, Canada, and the United States, who have also made claims to digital asset secuity services.
South Korea’s Shinhan Bank said in November it planned to start a bitcoin vault by mid-year. Outside banking, Palo Alto, California-based Xapo Inc. has offered clients secure storage for Bitcoin for about four years, while Goldmoney Inc., a Toronto-based firm that lets clients buy, sell and store precious metals in vaults in seven countries, started offering Bitcoin storage in September.
Bloomberg then provides the understanding that Taylor’s decision to incorporate Blockchain technology into the bank will enable it to rapidly grow in size in a short period of time.
VersaBank, with a market value of about C$158 million ($126 million), 80 employees and C$1.73 billion in assets, has outperformed Canada’s big banks, with shares soaring 24 percent this year versus the 2.9 percent decline of the eight-company S&P/TSX Commercial Banks Index. Last year VersaBank rose 19 percent compared to the 11 percent gain of the banks index. Taylor is now eyeing a bit more growth while staying the course.
“I’m happy to be a niche player, but can probably double the size we are in assets,” he said. “I think C$3 billion is kind of a nice number.”
As with any major paradigm shifts, there will be winners and losers. The blockchain is about to unleash a financial bomb in the financial industry that will lead to an entire fragmentation of the industry. Simply, the Blockchain will do to the financial industry what the internet did to media.