Goldilock: Fusing Hot and Cold Storage into The Ideal Storage

What on Earth is Goldilock?

Goldilock is a patent-pending technology that has the potential to revolutionise the storage and access to cryptocurrencies and digital assets alike.

the system leverages multi-factor authentication, biometrics, regressive non-IP technologies triggers, and cryptography to shift the burden of keeping wallets secure away from the individual investor and on to our physically-segregated platform.

The Challenge of Cybersecurity Today

The eruption of cryptocurrency rush, has opened a flood gates for hackers to plunder a fortune out of the entire ecosystem. In 2018 alone, hacks into crypto exchanges resulted in loses exceeding $800 Million. The major hacks tracked by Investopedia include:

Jun 2018 - Bithumb Hack: $30 Million
Jun 2018 - Coinrail Hack: $37.2 Million
Feb 2018 - BitGrail Hack: $195 Million
Jan 2018 - Coincheck Hack: $534 Million

Going back in time,

The DOA Attack: $55 Million
NiceHash hack: $63 Million
The Bitfinex hack: $72 Million
The Mt. Gox. Breach: $487 Million

Beyond Cryptos, the advancement in IoT opened another Pandora Box of vulnerabilities with a projected 80 Billion connected Smart Devices deployed world-wide by 2025.

Aside from these, other major threats includes

Good old fashions Hackers
Ransom ware
Botnet Attacks
Phishing Attacks
etc

Hence, it is obvious that securing your digital assets is much more critical than most would have actually thought of.

Security - A Major Deterrence For Adoption Cryptocurrency

With any emerging and disruptive technology, gaining traction is an uphill battle. Volatility, lack of ecosystem, lack of education are among the many factors that are inhibiting the mainstream adoption of cryptocurrencies.

However many would cite security (or rather the lack of it) as a major deterrence. According to a leading market researcher, Statista, 32% traders from cryptocurrency exchanges worldwide cited security of deposits as an deterrence for them!

In a separate article by Tripwire, a major digital security company, concluded that security concerns are detrimental to Bitcoin:

Virtual currencies also faces some serious security concerns and risks, such as the safety of wallets, double-spending, growing vulnerability to orchestrated attacks on Bitcoin exchanges, and fears of rogue miners engaging in selfish mining. These concerns that can be destructive towards Bitcoin are also real towards any other cryptocurrency, though not particularly in the same manner.

Hence, by settling the issue of security, it will draw those who are worried about it to embark on it. It is in fact:

One small step for security.
One giant leap for cyptocurrency!

Current Digital Storage Technology

Currently, the wallets of cryptocurrencies are divided into 2 distinct types: The hot and cold .. hmmm .. pretty much reminds me of Katy Perry! But it never have to be either one or the other, as both have their own merits.

Hot Storage

The most common hot storage wallet are usually web-based, like the ones provided by crypto-exchanges. In addition, there are also those 3rd party wallets like the Free Wallet. The greatest strength of these is it's accessibility. It can be accessible anywhere and anytime.

Unfortunately, it can also be access by anyone too! The longer the wallet or pool of wallets are online, the more time the hackers have to crack it's defenses and steal the bounty in them.

Cold Storage

The Cold Storage is the direct inverse instead. It is totally disconnected from the internet, and is stored in a physical mediums like USB drives, dedicated hardware wallets, or even the old school way of scribbling on a paper. Even global security leader, Kapersky highly recommend using a cold storage wallet for cryptocurrencies.

While it seemed immune to online hacking, has got it's own set of vulnerabilities like:

Hardware malfunction
Forget Password
Losing it
Accidental damages; or even ..
Eaten by your dog!

What's more, to effect any transactions or updates, you'll need to get it online and there is that small window of vulnerability as well

Goldilock's Solution to an Ideal Storage Solution

The design philosophy of Goldilock's patent pending solution is a fusion of best parts of both storage tech, and infused with the understanding of how humans actually are using those assets:

Users need access to their personal data quickly, but only occasionally and for short periods of time. Otherwise, online data is more useful to hackers than rightful owners.
Personal data (including private keys) must be isolated, secured from physical contact and related human error, and fully backed-up.
Personal data and private keys must be quickly accessible when needed.

With those considerations, the Goldilock's activation workflow is a 3 phase process. To avoid confusing you with a barrage of technical jargons, I'll make this explanation more relatable with the following illustration of a familiar medieval castle that is isolated from the landmass with a impassable moat.

Phase 1: The Isolation Phase

Wallet is stored offline in an encrypted data vault, physically disconnected from the internet.

Imagine a castle full of treasures of all sorts. This is very much like the encrypted data vault of your digital asset.

It's fortified and surrounded by a deep moat with hungry gators and deadly booby traps making impossible to reach. This is analogous to the your data being physically disconnected from the internet. There is no way to entering the castle unless permission is given.

Phase 2: The Authorisation Phase

Using a non-IP mechanism, the user activates their wallet making it accessible over the internet.

Unless you are going to eat gems and drink molten gold, you're going to need food and drinks to live comfortably. Occasionally, you'll let merchants in to trade for food, clothes, and goods that allow enjoy life. The same is true for the times that you are going to transfer your digital assets in and out of the storage.

At such times, you verify their identity and let down the draw-bridge to allow the crossing of the moat.

Likewise, Goldilock will verify if a visitor has the correct digital private key or token and connect it to the internet via non-IP Public Switch Telephony Network (PSTN).

Phase 3: The Interaction Phase

User can securely access their wallet over an encrypted connection using a dedicated URL and access credentials

Now with the bridge drawn down, and the merchant can enter the castle to trade. This is similar to you accessing and doing transactions after you've logged in to your digital assets.

After all that needs to be done is complete the merchant leaves, the bridge is drawn back, and the castle is back in isolation again. Just as how your digital is being taken offline and secured via the air gap again.

The above is an overly simplified analogy aimed at showing laymen how Goldilock works. Of course the authentication process is a lot more complicated.

(3 Images Source: Pixabay)

Development Roadmap

Development Roadmap of Goldilock

Source: Goldilock Website

Media Coverage

Despite being a very new player in the blockchain arena, Goldilock has already caught the attention some major publications. Below are just some of their media coverage.

Forbes: Top 10 New Blockchain Companies To Watch For In 2018

Goldilock is aiming to change the way data is stored and secured across the internet ... ... This will enable a robust cryptocurrency key custody and storage of sensitive digital assets.

Entrepreneur: The Top 15 Token Sales to Watch This Summer

Goldilock addresses both consumer and institutional concerns around crypto custody and security by offering a remote airgap custody solution that is also scalable

Partnership

Iron Mountain

Iron Mountain Incorporated (NYSE: IRM) is a global business dedicated to storing, protecting and managing, information and assets.

NakamotoX

NakamotoX is next generation bitcoin and digital asset trading platform, mostly made in the Czech Republic. Since 2015 NakamotoX is extensively invested in crypto currencies, their trading, mining and related system design.

NEO

NEO is a blockchain platform and cryptocurrency designed to build a scalable network of decentralized applications.

SmartChain Media

SmartChain Media is a new streaming video platform and business model, poised to take full advantage of the ‘tipping point’ that the entertainment industry is now experiencing; giving independent producers, influencers, and fans the chance to not only take part but actually be that disruption.

BitScope Designs