China has been a hotbed for cryptocurrency over the past few years. From June 2021 to July 2022, Mainland China recorded more than US$220 billion in total transactions, to make it East Asia’s top cryptocurrency market. The country also ranked 10th in Chainalysis’ 2022 Global Crypto Adoption Index, and was found to be especially strong in its usage of centralised cryptocurrency exchanges.
It should come as no surprise, therefore, that China was also home to many crypto firms who served global clients- until China banned the nascent technology and caused many to flee here to Singapore.
One of such companies was Cobo- a digital asset custodian that provides third-party storage and security services for digital assets. Founded in 2017 in Beijing, the company moved to Singapore in 2021- and opened a new headquarters in September last year.
So what does the company offer for Singapore’s ambitions as a global crypto hub, and what are their plans for the future?
What does Cobo actually do?
In a nutshell, a digital asset custodian like Cobo helps users store their private keys safely while they manage and transfer digital assets. But co-founder Discus Fish saw that far more could be done by custodians.
While working on F2Pool, the first mining pool in China, Fish saw the potential problem that many custodians could become.
“There were many hacking incidents that were plaguing the cryptocurrency community, and custodians represented a single point of failure when they are hacked since they store their customers’ private keys. I was determined to create a solution that was better- a custodian service that offered users more than just custody.”
Discus Fish, Co-founder of Cobo
To that end, he reached out with the idea to Dr Changhao Jiang, who had developed Bihang, China’s first cryptocurrency wallet. The million dollar idea was to create a flexible all-in-one solution that was better than anything else on the market, with risk-control strategies and military-grade security. This, he argued, would solve many existing issues that custody solutions on the market faced.
So in 2019, they launched Cobo Custody, the first Wallet-as-a-service service. It provided crypto wallet infrastructure to their clients, with access to more than 60 different chains and 1,600 different tokens. Clients could even customise their crypto wallet to suit their organisational needs.
Part of what makes Cobo attractive is that it offers organisations the chance to customise their wallets around their organisational structure as well. Clients are able to use this feature to minimise the probability of operational risks, and employees within a company can be assigned different permissions and roles based on what they actually do.
By the end of the year, Cobo Custody had become the largest crypto custodian in China, with many crypto exchanges and mining pools in China as their customers.
Over the next few years, Cobo has developed two additional product services: NFT-as-a-service and DeFi-as-a-service.
Cobo’s NFT-as-a-service is an all-in-one NFT management platform providing safe storage and custody of NFT assets in much the same way as its Wallet-as-a-service service functions, while its DeFi-as-a-service functions helps onboard institutions to the world of DeFi, while helping them use these protocols safely and efficiently.
What is Cobo currently working on?
Currently, Cobo is trying to create a shared wallet infrastructure with a dedicated blockchain, known as Cobo Chain. This infrastructure will support multi-chain and multi-layer custody, which means that users will be able to store tokens from different chains.
“The crypto landscape has evolved significantly over the past few years, and Cobo Chain will help us remain relevant in the years to come.
For one, Digital assets have reached scales of trillions of dollars in value- Cobo Chain will allow for users to plan their estates and pass on wealth to the next generation as the owner wishes, without the involvement of lawyers or trusts.”
Discus Fish, Co-founder of Cobo
In addition, Cobo Chain will be fully owned, governed, and empowered by the community through a Decentralised Autonomous Organisation.
Cobo is also in the process of applying for relevant licenses in Singapore, and has recently obtained a cybersecurity certification from Deloitte.
Thus far, Cobo has over 500 clients- and these include big names such as Baidu, A&T Capital, and Avalanche.
In December last year, Cobo launched ‘Evolution’, an NFT project with MetaMask Institutional. The project will create soulbound tokens for clients, so that their wallets can be easily identified by others- think of it as having the blue checkmark on twitter or instagram.
What plans does Cobo have for the future?
At present, Cobo is looking to expand their headcount at their new regional headquarters in Singapore, which opened in September 2022.
According to Cobo, they are ‘actively seeking out local institutions in an effort to help students by offering internships and signing them on after’.
The company is also hoping to establish partnerships with established firms in Singapore’s vibrant financial sector, as they see a strong synergy working with such companies.
“We hope to be able to offer companies our expertise in blockchain and digital asset technology. Singapore has opened its borders to crypto with a hub for global crypto, and to support that goal, we hope to be able to provide infrastructure and develop the crypto ecosystem in Singapore. Providing companies with a safe environment to access DeFi protocols and interact with smart contracts will be a good first step.”
Discus Fish, Co-founder of Cobo
For a start, Cobo is launching Superloop, an off-exchange custodian and settlement network. For traders, this will mean lower counterparty risks, and for exchanges, it ensures that traders can meet their obligations before executing trades, while providing an additional layer of security while meeting regulatory requirements.
In the future, Cobo will likely work on account abstraction, in which they turn accounts into smart contracts with their own logic to define what transactions are valid.
Aside from companies, Cobo is also looking to build strong relationships with MAS, the Singapore Blockchain Association, and the Singapore Manufacturing Federation.
For the opening of the company’s new headquarters, they invited MAS Chief Fintech Officer Sopnendu Mohanty, as well as Shadab Taiyabi and Chia Hock Lai, President and Co-Chairman of the Singapore Blockchain Association respectively.
Cobo may not be a company that is extremely glamorous- its founders are not the brash ideologues often seen in crypto, and its products do not promise great riches if you just hold on to them.
Instead, Cobo is building something necessary for the industry, and providing secure infrastructure to the industry of the future. Industries need firm foundations- and Cobo is providing just that. Perhaps glamour and get-rich quick schemes are overrated- and we should take a look at companies like Cobo to see what building a proper company should look like.
Featured Image Credit: TechCrunch