Northern Trust to Open Doors to Crypto Hedge Funds

According to the estimates, Northern Trust manages and stores $10.7B
01 August 2018   840

The giant of the financial services sector Northern Trust, which occupies 486th line of the Fortune 500 list, helps its clients to get acquainted with the crypto-currency ecosystem. This is reported by the Forbes.

Founded 129 years ago, a Chicago firm focused on institutional investors, corporations and high-income individuals, opened part of its services for cryptocurrency hedge funds, while exploring the possibilities for integrating the blockchain into its private equity unit.

According to the publication, Northern Trust has been working for several months with three "mainstream hedge funds", which began including cryptocurrencies to their investment portfolios.

According to the estimates, Northern Trust manages and stores $10.7B. Currently, the company does not provide cryptocurrency storage services directly, but it offers administrative services, such as assistance in assessing investments, meeting anti-money laundering requirements and verifying third-party custody services, for hedge fund interest and institutional investors interested in cryptocurrency.

President of the Northern Trust for Corporate and Institutional Services Pete Cherecwich, in a conversation with Forbes, said that although officially his company adheres to a prudent position in the issue of crypto-currency, it is ready for the fact that in the future the currencies on the blockchain will be issued at the state level.

I do believe that governments will ultimately look at digitizing their currencies, and having them trade kind of like a digital token — a token of the U.S. dollar — but the U.S. dollar [would still be] in a vault somewhere, or backed by the government. How are they going to do that? I don’t know. But I do believe they are going to get there.
 

Pete Cherecwich

President, Northern Trust for Corporate and Institutional Services

Cherecwich also said that within the framework of his organization there is a team consisting of more than a dozen specialists in blockchain and direct investment who must create a set of tools based on a private version of the corporate blockchain system of Hyperledger Fabric.

Last year, the head of the Northern Trust called for "prudent" regulation of the detachment, noting that "databases have never been regulated," and the establishment of new rules in this area carries "potential threats" too fast.

Potentional Vulnerabilities Found in ETH 2.0

Least Authority have found potentional security issues in the network P2P interaction and block proposal system
26 March 2020   935

Technology security firm Least Authority, at the request of the Ethereum Foundation, conducted an audit of the Ethereum 2.0 specifications and identified several potential vulnerabilities at once.

Least Authority said that developers need to solve problems with vulnerabilities in the network layer of peer-to-peer (P2P) interaction, as well as in the block proposal system. At the same time, the auditor noted that the specifications are "very well thought out and competent."

However, at the moment there is no large ecosystem based on PoS and using sharding in the world, so it is impossible to accurately assess the prospects for system stability.
Also, information security experts emphasized that the specifications did not pay enough attention to the description of the P2P network level and the system of records about Ethereum nodes. Vulnerability risks are also observed in the block proposal system and the messaging system between nodes.

Experts said that in the blockchains running on PoS, the choice of a new block is simple and no one can predict who will get the new block. In PoS systems, it is the block proposal system that decides whose block will fall into the blockchain, and this leads to the risk of data leakage. To solve the problem, auditors suggested using the mechanism of "Single Secret Leader Election" (SSLE).

As for the peer-to-peer exchange system, there is a danger of spam. There is no centralized node in the system that would evaluate the actions of other nodes, so a “malicious" node can spam the entire network with various messages without any special punishment. The solution to this problem may be to use special protocols for exchanging messages between nodes.