Qualified electronic custody: the shield companies need to avoid risks

A significant number of companies still do not have the support of a qualified digital asset custody service. This decision, which might offer short-term savings, will have serious consequences that will jeopardise the stability and future of these organisations.

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ensitive data, electronic documents, smart contracts, and files in any format generated during transactions by banks and companies. The custody of all these digital assets is crucial to ensure security, integrity, and availability, aspects that are fundamental for the proper functioning and reputation of companies. 

A simple document manager cannot cover all the needs of organisations. The regulatory framework is increasingly complex, requiring intelligent, rigorous strategies that place control in the hands of the client. 

The risks of not having a qualified digital asset custody service 

• Loss or theft. One of the most obvious risks is the loss or theft of assets. Cyberattacks are becoming increasingly sophisticated, and companies that do not have adequate security measures in place are easy targets for cybercriminals. The loss of digital assets can have a devastating impact, as it may involve the loss of confidential information, the disruption of critical operations, and significant difficulties in regaining control.

• Damage to reputation. Data breaches or theft of digital assets can severely damage a company’s reputation. Customers and business partners will lose trust in an organisation that is unable to protect the information generated during digital transactions. A qualified custody service helps protect the company’s reputation by minimising the risk of security incidents.

• Recovery costs. In the event of a security incident, companies without adequate support will incur high costs to recover information. These costs may include hiring cybersecurity experts, lost revenue due to operational disruptions, and even ransom payments to cybercriminals who often pressure companies through direct harassment or denial-of-service attacks to extract large sums of money or cryptocurrencies.

• Growth difficulties. Lack of confidence in document preservation can hinder a company’s growth. Potential investors and partners will be reluctant to collaborate with an organisation that does not adequately protect its data and digital assets. A qualified custody service can be a key factor in building trust and attracting new business opportunities.

• Non-compliance with regulations. Companies that do not comply with regulations regarding the storage and custody of digital assets risk significant penalties, and even the loss of licenses and permits to operate. A qualified custody service like TrustCloud Quantum Vault ensures that digital assets are stored and managed in accordance with current regulations, updating as necessary, providing companies with the peace of mind that they are operating within a secure legal framework. 

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Regulations at risk of non-compliance for companies without qualified custody 

From financial services and telecommunications companies to insurance firms, real estate agencies, and public administrations, all these sectors must manage highly sensitive information responsibly. Despite existing tools to prevent them, multimillion-dollar fines for deficiencies in data protection measures or lack of consent continue to accumulate. 

Companies that do not have a qualified digital asset custody service risk non-compliance with various international regulations. 

• Anti-Money Laundering and Financing of Terrorism Legislation (AML-CT). It is essential to adopt measures to identify and verify the identity of clients, as well as to monitor their transactions and detect suspicious activities. Qualified custody will help companies comply with these regulations by implementing robust protection measures (access shielding, timestamping, etc.) and control.

• Markets in Crypto-Assets Regulation (MiCA). Issuers, custodians, or providers of crypto-assets must obtain a licence and comply with a series of obligations to ensure transparency and protect investors’ interests.

• General Data Protection Regulation (GDPR). Companies must implement appropriate technical and organisational security measures to protect the personal data they process. A qualified custody service will protect clients’ personal data through data encryption, access control, and continuous staff training. 

Qualified custody is essential for ensuring compliance with these critical regulations and avoiding substantial penalties. 

TrustCloud, as a Qualified Trust Service Provider (QTSP), issues custody certificates that verify compliance with these regulatory frameworks, as well as others like SEPBLAC (The Executive Service of the Commission for the Prevention of Money Laundering and Monetary Offences) in Spain or eIDAS at the European level. 

Quantum Vault helps companies comply with these regulations effectively and efficiently, providing them with the peace of mind that they are operating within a secure legal framework. We ensure the integrity of the content of an electronic document, regardless of its format, and its issuance date. We operate with complete neutrality and certify that an asset has not been tampered with, backed by the most advanced encryption technology. Qualified electronic custody creates legally valid proof, which can shift the burden of proof in case of litigation. 

Furthermore, in a powerful strategic decision, DocuSign and TrustCloud have strengthened their alliance with the inclusion of TrustCloud Quantum Vault in the DocuSign App Center marketplace. Our custody service has been available on this platform in the United States since June 2024 and will be available in Europe and the rest of the world from autumn, making us the first and only European partner of DocuSign to launch a service in App Center. 

Request information now about our qualified custody service, TrustCloud Quantum Vault