BitGo provides institutional digital asset custody, trading, and financial management services. Traders can safeguard private wallets and custody credentials using BitGo. Developers can integrate BitGo’s functionality into their apps by utilizing APIs and connecting webhooks from open-source projects. BitGo offers secure and scalable solutions for the digital asset economy, including regulated custody, borrowing and lending, and essential infrastructure for investors and developers.

What is BitGo?

BitGo is a multisignature Bitcoin wallet service wherein keys are distributed among multiple owners to mitigate risk. BitGo innovated multi-signature technology, necessitating several private keys for transaction authorization. This substantially improves the security of crypto assets, rendering it more difficult for any individual or entity to access funds without appropriate authorization. BitGo provides custody services specifically designed for institutional clients, offering secure storage solutions for substantial investors, including hedge funds, family offices, and various financial organizations. These services ensure compliance with regulations and offer features like insurance coverage.

BitGo offers cold and hot wallet services; cold wallets are offline and enhance security. Hot wallets are internet-connected for immediate access to funds and comply with various regulatory requirements across jurisdictions, establishing themselves as a reliable service for institutional clients in the cryptocurrency sector. Typically, BitGo wallets consist of three keys: one retained by BitGo and two possessed by the wallet’s owner. Wallets can be set up in hot and cold configurations and in non-custodial and custodial formats. BitGo specializes in delivering secure, scalable, and compliant solutions for digital asset management, positioning itself as a pivotal entity in the expanding industry of institutional crypto services.

Background of BitGo

BitGo, Inc. is a digital asset trust and security firm in Palo Alto, California. It was established in 2013 by Mike Belshe. Mike Belshe, born in 1971, is an American computer scientist and entrepreneur. He is the co-founder and Chief Executive Officer of BitGo. Mike Belshe co-founded Lookout Software in 2004, co-invented the SPDY protocol, and is the primary HTTP/2.0 specification author. He is an inventor possessing more than 10 technology patents.

In June 2014, the company secured US$12 million in venture capital financing, spearheaded by Redpoint Ventures. In October 2018, the startup secured US$15 million in venture finance from Goldman Sachs and Mike Novogratz’s Galaxy Digital. In 2021, Galaxy Digital declared its acquisition of BitGo for $1.2 billion; however, this deal was subsequently announced as terminated in 2022 following the cryptocurrency slump, with BitGo remaining an independent entity. On August 16, 2023, BitGo secured $100 million in Series C fundraising at a valuation of $1.75 billion. BitGo stated that the financial contributors were “novel, external strategic investors” without disclosing their identities.

Features of BitGo

BitGo provides various services to improve digital asset security, management, and compliance, especially for institutional clients. The following are the significant features of BitGo:

Multi-Signature Wallets

BitGo innovated using multi-signature technology, necessitating multiple private keys to authenticate and authorize a transaction. This guarantees that the assets remain protected even if a single key is compromised. Users can specify the number of signatures required to approve transactions, providing flexibility in security procedures.

Institutional Custody Solutions

BitGo provides secure cold storage solutions that safeguard private keys offline to prevent hacking and unwanted access. BitGo provides hot wallets for rapid access to funds, incorporating additional security measures to protect online transactions. BitGo’s custody services are insured (up to a specified limit), safeguarding clients’ digital assets from theft, hacking, and other vulnerabilities. BitGo guarantees adherence to financial regulations across multiple jurisdictions, rendering it appropriate for institutional investors. It also assists clients in complying with KYC (Know Your Customer) and AML (Anti-Money Laundering) regulations.

Key Management and Encryption

BitGo offers a safe mechanism for managing private keys, incorporating advanced encryption techniques that thwart unauthorized access. The platform distributes private keys across various locations, ensuring a backup if any segment is lost or hacked.

Security

BitGo offers multi-factor authentication (MFA) to enhance security for users accessing their accounts and digital assets. The software perpetually surveils accounts for anomalous activity, issuing immediate notifications upon detection of any irregular transactions or access attempts. BitGo facilitates integration with its platform through a secure API, providing encrypted data transmission and enhanced security protocols to safeguard user accounts. BitGo implements an autonomous framework of checks and balances, oversight of operations, and capital reserves. BitGo guarantees regulatory adherence and security through third-party audits, encompassing SOC certifications.

Digital Asset Support

BitGo accommodates a diverse range of cryptocurrencies, such as Bitcoin, Ethereum, Litecoin, and numerous others, enabling users to store and manage different digital assets within a single wallet. BitGo’s wallets accommodate numerous blockchains, facilitating the efficient handling of diversified assets across several networks.

How Does BitGo Work?

BitGo offers secure custody and management services for digital assets (cryptocurrencies), emphasizing security, compliance, and scalability. It provides various solutions to protect crypto assets and enable effective management, especially for institutional clients. BitGo’s fundamental security framework relies on multi-signature wallets. BitGo necessitates numerous private keys to authorize a transaction rather than relying on a single private key to restrict access to funds. A wallet may require 3 out of 5 keys (a 3-of-5 model) to authorize and complete a transaction. This indicates that even if one or more keys are compromised, the funds remain secure, provided the requisite threshold of signatures is achieved.

BitGo employs a decentralized key management architecture that guarantees the secure division of private keys across many locations and devices. This mitigates the danger of key compromise or loss. To send cryptocurrency, a user initiates the transaction on the BitGo platform. Per the multi-signature policy, the transaction requires the requisite quantity of private keys to authenticate and endorse the transaction. BitGo accommodates various cryptocurrencies and digital assets, including Bitcoin, Ethereum, and other ERC-20 tokens. This enables users to store, manage, and transfer diverse digital assets inside a single platform.

BitGo Services

BitGo provides extensive services to deliver secure, scalable, and compliant solutions for managing digital assets, specifically tailored for institutional clients, including hedge funds, exchanges, and family offices. Presented here is a delineation of the principal services offered by BitGo:

Wallet Services

BitGo provides an insured, regulated, and qualified custodial wallet designed to protect customers’ digital assets, with the keys stored offline in cold storage. This service is particularly favored by institutional clients requiring optimal security for substantial digital asset holdings. In custodial wallets, BitGo retains all three keys, securely stored in cold storage and disconnected from the internet. The client must initiate a transaction with the BitGo team and undergo a series of security verifications to transfer funds.

BitGo offers hot wallets for clients needing expedited access to digital assets, incorporating multi-signature and additional security protocols to mitigate risk. BitGo Custody Wallets are tailored for enterprises, providing a modular method that facilitates the creation of wallets through a straightforward, user-friendly, and pre-configured developer experience. The wallet facilitates businesses in accessing cash from cold storage by enabling direct trading, lending for reliable interest generation through BitGo Prime, or staking for prizes. By utilizing self-custodial hot wallets, businesses can combine custody wallets with self-custody hot wallets to securely maintain a portion of their cash while ensuring remaining liquidity.

BitGo provides customers with cold storage secured by bank-grade protection, enables fund withdrawals throughout the week with a 24-hour service level agreement, implements a comprehensive set of identity verification procedures and controls, and offers users the option to pre-approve the addresses to which assets can be sent. As per the BitGo website, over 9.9 million wallets are established, over 1,100 digital assets are supported, and $2 trillion in lifetime transactions are conducted on the BitGo custody wallet.

Self-custody Hot Wallet

A hot wallet is a cryptocurrency wallet always linked to the internet, facilitating rapid and convenient access to digital assets. BitGo’s self-custody hot wallet provides a safe access point to decentralized finance (DeFi). BitGo’s self-custody hot wallet enables users to retain a portion of their assets in self-custody hot wallets for expedited transfers, staking, and DeFi activities. In key management for the hot wallet, users retain the Client and Backup Key, whereas BitGo holds the Platform Key. Users must employ the user key to initiate a transaction. BitGo will only countersign if the transaction adheres to its established criteria.

BitGo’s self-custody hot wallet is engineered for enterprises to prioritize liquidity while maintaining security. Businesses may also hold certain assets in a liquid form to seize market opportunities or manage time-sensitive transactions. They can establish wallet policies to restrict who may initiate or authorize transactions, the amount that can be transmitted, and the destinations for the assets.

The wallet features backup key storage that retains users’ backup keys with a third party, provides UI access for viewing or transferring assets directly through the BitGo app, and offers API access for programmatic management of self-custody hot wallets.

Self-custody Cold Wallet

BitGo’s self-custody cold wallet provides users with autonomy over their security. Users may securely store, manage, and safeguard their assets with keys under their control. BitGo’s self-custody cold wallet allows businesses to engage in sporadic yet significant transactions with improved security and adherence to jurisdictional key storage regulations. BitGo clients utilizing self-custody cold wallets possess control over two of the three keys in an offline setting rather than an online one. Customers initiate and partially sign transactions offline, subsequently uploading them to BitGo for countersigning, ensuring the user key remains undisclosed.

BitGo’s self-custody cold wallet enables businesses to oversee their cold storage, safeguarding their cash by ensuring the client key remains offline while allowing customization of account restrictions, like user permissions and transaction limits, for enhanced control. The cold wallet adheres to local legislation mandating designated safekeeping locations while utilizing BitGo’s advanced technology and protocols. Businesses may safeguard their client key offline while utilizing BitGo’s technology to develop a more advanced, tailored configuration.

Go Network

BitGo Go Network is a cohesive platform for managing all funding, trading, and settlement activities. BitGo Go Network facilitates the immediate settlement of USD and digital assets between parties on the network using Delivery vs Payment among Go Network clients. Customers can trade on exchanges in real time while retaining custody using BitGo Trust. All assets within the BitGo Go Network are safeguarded in cold storage, isolated from counterparties or exchanges, and are under the custody of BitGo Trust until the settlement occurs. Digital assets are maintained in regulated, cold-storage-qualified custody. At the same time, USD is held and settled through FBO omnibus accounts distributed among FDIC-insured banking partners.

The BitGo Go Network may also refer to the BitGo Go API, a component of BitGo’s toolkit intended for developers and enterprises to incorporate BitGo’s cryptocurrency wallet and custodial services into their platforms or applications. The Go Network utilizes the Go programming language. It provides APIs for users to engage with BitGo’s wallet infrastructure, multi-signature technologies, and digital asset management services.

The website indicates that there are 157 supported Go assets, including Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), ERC-20 tokens, and others; $6 billion in Go transactions settled; and 24/7 fast settlement provided by the service. The Go Network provides consumers a platform to mitigate settlement failures through delivery vs payment and off-exchange settlement, thereby reducing risk and facilitating seamless transactions. It also enables users to navigate changing rules with assurance by distinguishing between custody and trading.

The BitGo Go Network is a robust resource for enterprises and developers aiming to incorporate BitGo’s secure wallet architecture and services into their systems. It is particularly advantageous for institutions and exchanges that require secure management and transaction of substantial volumes of digital assets while adhering to regulatory norms.

BitGo WBTC Story

BitGo WBTC denotes Wrapped Bitcoin (WBTC), issued and endorsed by BitGo, a prominent digital asset custodian and provider of institutional-grade cryptocurrency services. Wrapped Bitcoin (WBTC) is an ERC-20 token on the Ethereum blockchain that symbolizes Bitcoin (BTC) in a tokenized format, facilitating the utilization of Bitcoin within Ethereum’s decentralized finance (DeFi) ecosystem. BitGo, as a reliable custodian, is integral to the WBTC ecosystem by safeguarding the actual Bitcoin holdings and verifying the authenticity and support of WBTC tokens.

BitGo transitioned its WBTC operations to the inaugural multi-jurisdictional and multi-institutional custody through a distinctive collaboration and joint venture with BiT Global. BitGo will hold a minority stake in the new joint venture. BiT Global is an international custody platform with regulated activities located in Hong Kong, recognized as a Trust and Company Service Provider (TCSP). This constitutes a strategic alliance with BitGo, Justin Sun, and the Tron ecosystem, which now represents the foremost blockchain hosting the most outstanding circulating supply of USDT stablecoins globally, exceeding $60 billion.

The initiative would enhance the security of WBTC operations by diversifying custodial countries and locations for the underlying Bitcoin, which was hitherto stored in the United States. WBTC is the prevailing standard for Bitcoin integration into DeFi apps across an expanding array of blockchains, catering to the requirements of its worldwide customers. WBTC operations will be geographically and jurisdictionally diversified post-upgrade to encompass Hong Kong and Singapore. The joint company will maintain the existing BitGo multi-signature technology and deep cold storage, with the sole modification being the capability to spread keys across various global locations.

FTX Refund Option

FTX, the defunct cryptocurrency exchange, has announced its intention to commence the reimbursement of funds to its clients. Following over two years of bankruptcy proceedings, the FTX team has designated January 3, 2025, as the official date for implementing the payback plan. FTX has collaborated with two cryptocurrency firms—Kraken and BitGo—to facilitate money distribution and enhance procedural efficiency. BitGo has been appointed by FTX Trading Ltd. and its associated creditors to facilitate the distribution of recovery to retail and institutional clients in authorized jurisdictions by the U.S. bankruptcy court-sanctioned FTX Chapter 11 Plan of Reorganization.

FTX retail users can safely recover their cash while utilizing BitGo’s regulated, wholesale-priced, institutional-grade custody, trading, and staking services. Furthermore, qualifying U.S.-based FTX clients may engage in BitGo’s current Bitcoin Giveaway Program, with the chance to win one whole Bitcoin each quarter in 2025. A prominent characteristic of BitGo is its security and trust, which underpin its business model. BitGo, as a leader in cryptocurrency security and fund recovery, significantly contributed to the Mt. Gox bankruptcy in 2014, establishing benchmarks for protecting and allocating digital assets throughout the bankruptcy proceedings.

Users can utilize BitGo for:

• Recover funds: The BitGo platform guarantees a secure and effective procedure for financial restitution. If the user’s status in the FTX Claims Portal indicates “Approved,” you are prepared to receive your funds, which will be credited to your BitGo Go Account. Upon receipt, users can immediately withdraw, trade, stake, and safeguard their digital assets.
• Utilize a streamlined recuperation procedure: BitGo’s infrastructure streamlines your recovery process, whether you get USD or choose stablecoins such as GoUSD or USDC.
• Protect their digital assets: Receive industry-leading security with insurance coverage up to $250M. BitGo’s insurance policy is underwritten by a consortium of insurers within the Lloyd’s of London and European markets.

Conclusion

BitGo is a leading digital asset custodian and security platform that offers services for cryptocurrency wallets, private keys, and digital asset management. Established in 2013, BitGo has emerged as a premier provider of institutional-grade security solutions for cryptocurrencies. BitGo’s integration of stringent security protocols, adherence to regulatory standards, and pioneering functionalities have established it as a reliable option for institutional investors, exchanges, and enterprises managing substantial digital assets.