Web3 Security: Exploring Wallet and Custodial Security from a Hardware Perspective

Recently, a roundtable forum focusing on "Web3 Wallets and Custody Security" was held at the Global Web3 and AI Summit. The forum explored the construction of a more secure and scalable Web3 asset protection mechanism from the underlying perspective of hardware and system software.

The guests participating in the discussion include executives and technical experts from several well-known companies. They engaged in an in-depth discussion on topics such as Web3 user security pain points, advanced custody architecture, and the challenges and breakthroughs of the open-source ecosystem.

The host pointed out in the opening: "The security of private key custody and Web3 wallets heavily relies on the security of devices and hardware, but discussions around the underlying system and hardware security are not common." He emphasized that current discussions on Web3 security often focus on on-chain protocols and smart contracts, while the decisive role of underlying hardware and system architecture is often overlooked.

An expert from a large technology company shared the technical architecture of their team in high-security digital asset custody, including EAL5+-based partitioning and cold storage signing processes, and specifically introduced how the offline signing orchestrator system supports bank-grade custody services.

Another CEO participating in the discussion approached the issue from a practical perspective, pointing out through examples that the existing custody models "entrusted custody" and "self-custody" both expose systemic risks. He further introduced a solution based on "distributed custody" and MPC-TSS technology, emphasizing the application value of a flexible and scalable signing structure for both enterprises and individual users.

The founder of a blockchain technology company started by discussing the practical challenges of open-source technology, sharing his team's practical experience in multi-terminal computing and local security isolation, and calling for the industry to think more systematically about the openness and credibility of the underlying architecture while ensuring user experience.

A hardware security expert, drawing on years of experience in hardware security modules (HSM) and key management, analyzed the current key bottlenecks and response strategies in hardware custody solutions. He stated that hardware trust boundaries are crucial when building a global digital asset infrastructure.

In discussions about the future forms of Web3 Wallets, guests generally believe that composable and modular multi-signature architectures will become the mainstream trend, with balancing user experience and security being the core challenge. The host added: "Financial institutions have become accustomed to using dedicated hardware (such as HSM) for private key and signature management; relevant security evaluations, such as EAL and FIPS, are also widely accepted by regulatory bodies. However, these evaluations are not specifically aimed at verifying the security of blockchain signature implementations, so the level of security protection for digital assets provided by these systems still needs to be audited by professional blockchain security companies." He pointed out that "custody" is essentially a design issue rather than a single technology stack. An ideal custody solution should effectively prevent operational errors through system mechanisms while ensuring users have a moderate degree of operational freedom.

In addition, regarding the role of open-source software in Web3 hosting, the guests expressed a cautious yet optimistic attitude. Experts pointed out the legal gaps and market barriers facing open-source chip design, calling for the industry to further improve on safety and transparency. Another expert also discussed how to achieve module-level open-source isolation without sacrificing performance, starting from operating system-level security.

At the end of the forum, the host summarized: "The underlying technology of private key custody and Wallet is still evolving, and we look forward to providing verifiable and user-trusted security solutions through cooperation in the future."

This roundtable forum provided valuable insights into the Web3 security field, emphasizing comprehensive security considerations from underlying hardware to system architecture. As technology continues to evolve and the regulatory environment becomes increasingly clear, the industry looks forward to developing safer and more reliable Web3 asset protection solutions.