Digital currency storage service Elliptic has obtained ISAE 3402 accreditation – a global standard for financial reporting – from auditing specialist KPMG.
The ISAE 3402 Type 1 or SOC1/2 review scrutinises various aspects of a business, including financial controls, regulatory compliance including AML and KYC measures, financial controls, code deployment, disaster recovery, segregation of duties and offline bitcoin storage techniques.
The UK-based storage provider says it is the first bitcoin company to receive the accreditation and that ISAE 3402 indicates that the firm operates with the “same standards as a conventional custodian bank”.
Elliptic, which provides services to investment funds and trading houses, explained that the successful review demonstrates security and regulatory compliance, as well as the robustness of its bitcoin storage solution.
Accreditation ‘important milestone’
Elliptic CEO James Smith explained why the accreditation from one of the ‘Big Four’ accounting firms is so significant for the company:
“We pride ourselves on understanding and respecting the complexities of regulated financial systems. KPMG’s accreditation is an important milestone, as it demonstrates our commitment to delivering both best-in-class technology and deep operational expertise.”
Smith added that Elliptic is “absolutely confident” in its technology, but went on to note that a bitcoin storage company needs to offer more than its own confidence.
“This report demonstrates to our customers that we have the rigorous internal processes and controls expected of any traditional financial services provider,” he said. “Combined with our comprehensive insurance protection, they provide the robust infrastructure required for institutional involvement in digital currencies.”
Elliptic’s focus on security
Since its inception and launch a year ago, Elliptic has tried to differentiate itself by offering “deep cold storage” techniques for bitcoin, backed by insurance “providing protection against theft of stored bitcoins”.
After an early attempt to gain cover from Lloyds of London broke down, the company was forced to look for alternative insurance providers and eventually managed to insure its holdings through insurance brokers CBC Insurance.
A few months later, in July 2014, Elliptic managed to secure $2m in seed funding from Octopus Investments.