CoolBitX, a Taiwanese cryptocurrency wallet company, has received an investment from Japanese financial services management group SBI Holdings to help develop new hardware and store the investor’s own currency.
The Japanese investor bought 40% of the Taiwanese firm, according to a press release March 2 after evaluating CoolBitX’s product and technology offerings. The investment of an undisclosed sum effectively brings CoolBitX on as SBI’s key supplier of cryptocurrency cold storage, meaning keys to the currency are available offline.
The Japanese finance giant has invested in cryptocurrency for several years. Notable investments include a partnership with the distributed ledger startup Ripple to establish the new firm SBI Ripple Asia in 2016. The same year it bought into Japan's biggest cryptocurrency exchange bitFlyer.
The Tokyo-based financial services company’s investment in CoolBitX would be another step forward for blockchain innovation. The startup will use the funds to increase staffing, develop security technology and break into international markets.
“A safe and user-friendly cold wallet plays a key role to help the ecosystem go mainstream,” said Yoshitaka Kitao, president and CEO of SBI said in a statement. “We believe that CoolBitX has the technology capable to complete our ecosystem. This investment has strategic implications to SBI for building a cryptocurrency ecosystem blueprint.”
CoolBitX is positioning to compete with cryptocurrency wallet services such as Trezor and Ledger Nano S. It will use SBI’s funding to develop high-end security products that the world’s cryptocurrency ecosystem needs.
CoolBitX started with a 2014 Indiegogo campaign in Taipei as a blockchain technology developer. Founder and CEO Michael Ou, 31, is a Taiwanese fintech entrepreneur with a background in entrepreneurship, marketing and communications.
Ou turned CoolBitX into a global maker of bitcoin hardware wallet.
“CoolWallet is more than just a cryptocurrency wallet,” he said in a press statement. The wallet acts as a “bridge” between the blockchain and common people, he said. It’s ideal, he added, for identification, healthcare, and insurance.
Since its establishment, the company has raised around US $200,000 from Asia Pacific venture capital firm Midana Capital through the FundedHere crowdfunding platform. Other investors include bitcoin mining firm Bitmain and Kyber Capital.
CoolBitX has sold more than 100,000 CoolWallets in Europe, the United States and Asia, among other regions. Their biggest markets are South Korea and the United States. It will expand this year in Japan, South Korea, Taiwan and the United States.
South Korea is the world’s No. 3 market in Bitcoin trading, after Japan and the United States.
The startup’s credit-card-sized device stores private keys to cryptocurrency assets offline, letting owners of the new, fast-changing asset reduce the risk of theft. The hardware wallet comes with a physical cold-storage credit card shaped device and a smartphone app.
CoolWallet can connect to iOS and Android via Bluetooth. It can connect as well to smartphones and other USB-less devices.
CoolBitX launched the second-generation CoolWallet S hardware wallet this month. This version, called CoolWallet S, supports iOS and Android in trading popular cryptocurrencies such as Bitcoin, Ethereum, Litecoin and Ripple.
The hardware features a built-in display screen, a Bluetooth connection and a lithium battery to let users easily make transactions or check their balances.
“In response to the booming cryptocurrency markets, CoolWallet must continue to evolve to meet the needs of consumers,” Ou said. “With eight months of research, development, and testing, we have successfully upgraded the original CoolWallet design of Bitcoin storage into the second generation CoolWallet S with enhanced security and multiple patented technologies.”
Security of the kind that the wallets offer is “the most critical” element of blockchain development, said Thomas Hu, founder and CEO of Kyber Capital, an early investor in CoolBitX.
Tokyo-based cryptocurrency exchange Coincheck exchange was hacked January 26, draining it of roughly 58 billion yen ($532.60 million) worth of cryptocurrency. The stolen coins had been stored in an internet-connected "hot wallet" instead of a "cold wallet" offline.
Hot wallets, while popular for daily transactions, are now considered insecure as they can be accessed anywhere with an internet connection. Cold wallets keep access to cryptocurrencies offline. A hardware wallet such as the ones sold by CoolBitX, is one form of cold wallet.
“CoolWallet is a leading innovator in the world,” Hu said. “We are very proud to see a strong team in our investment portfolio has won strong recognition and strategic support from SBI, a global leader in fintech.”
News source is from Business Next.