News & Articles

May 31, 2023

New Digital Assets Custody Standard and certification regime

DACS V2.0 reflects latest developments in the custody space

The Capital Markets and Technology Association (CMTA), an independent Swiss association bringing together actors from the financial, technological, audit and legal sectors has released version 2.0 of its Digital Assets Custody Standard (DACS), a set of requirements and recommendations for the custody and management of digital assets, as well as a new certification label to demonstrate adherence to the standard.

Filling a void in best practice for custody of digital assets

The DACS was first published in October 2020, and has become a respected industry benchmark for how custodians should control clients' digital assets on a distributed ledger. The Standard provides baseline requirements and recommendations regarding the reliable setup and operation of digital asset custody solutions. In particular, it covers the critical procedures in which secret cryptographic keys can be generated, stored and recovered in a secure manner.

Recent custody developments and MPC-based solutions

Following a detailed review by CMTA stakeholders, version 2.0 of the DACS has been released to reflect new developments in the custody space, in particular MPC-based solutions. Furthermore, the wording of certain requirements has been changed to render them more auditable, with respect to the CMTA.DACS certification regime.

A new certification regime to provide more transparency

CMTA newly provides a certification framework, which allows custodians to demonstrate adherence to the DACS by using the CMTA.DACS trademark. A key requirement to secure the right to use the trademark is the delivery to CMTA of an opinion from a recognized audit firm, confirming that the operations and/or infrastructures of the relevant custodian comply with the DACS' recommendations and requirements.

Jacques Iffland, CMTA Chairman, says "Since the publication of the DACS, we have seen digital assets become increasingly popular with both private and professional clients. However, experience shows that the vast majority of them do not wish to look after the private keys themselves, and prefer to use professional custody solutions. The DACS aims to provide the industry with an important tool to meet this growing demand."

Dr. Jean-Philippe Aumasson, Tech Committee Chair at the CMTA and co-Founder at Taurus Group, concludes: "For investors, the availability of high-assurance custody solutions is essential. CMTA's updated custody standard will continue to be an important contribution in the adoption of digital assets."

The updated version of CMTA's standard for the safe custody of digital assets has been developed by a working group of CMTA's Technical Committee and published after consulting members.