KEY TAKEAWAYS
- Auki Network has transitioned to a new third-party custody solution to enhance transparency and security.
- The migration involves moving tokens to new wallets and resetting permissions for routine operations.
- The new custody solution offers improved insurance coverage and better visibility for stakeholders.
- This strategic move aims to align with best-in-class implementation standards and address previous flaws.
Auki Network has announced a significant update regarding its token management strategy. The network has transitioned to a new third-party custody solution, a move aimed at enhancing transparency and security for its stakeholders. This update was shared to maintain the network’s commitment to radical transparency and building in public, as detailed here.
Third-party custodians play a crucial role in the cryptocurrency ecosystem by securely holding and managing digital assets on behalf of clients. They store the private keys necessary to access tokens, thereby increasing security. Custodians can be centralized or decentralized, each with distinct approaches and regulatory requirements. The choice of a custody solution is critical for any project and requires continuous evaluation.
Reasons for the Migration
The decision to change the custody solution primarily involved migrating tokens to new wallets managed by the new custodian. This process also included resetting permissions for routine operations, such as the weekly node operator reward job. Some community members may have noticed on-chain movements, prompting the network to clarify the reasons behind the migration.
The previous custody solution had certain flaws that could have affected the perception of the network among its community. It also did not align with what the network considers a best-in-class implementation. Addressing these issues was a key factor in the decision to migrate.
Benefits of the New Custody Solution
The migration to the new third-party custody solution offers several benefits, including improved visibility and transparency. The new setup provides better insurance coverage for the network’s wallets, with comprehensive insurance of USD 50 million through Hex Trust. This enhanced transparency is already benefiting the community by providing more accurate circulating supply data on platforms like CoinGecko.
The transition to a multifaceted custody solution is seen as a strategic move to secure a better solution for both the present and future needs of the network. By sharing this update, Auki Network aims to ensure full transparency and provide context for any observed on-chain movements.
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