The following post is a short explanation of the security fundamentals that we base our Custody operations on and why we found the solution for moving funds offered by BTCP team to be unsuitable.
Despite our best efforts to address the issue, BTCP developers did not provide us with either the code or the documentation for P2SH-P2WPKH transaction cryptography used in their blockchain. They proposed a solution where we would use BTCP wallet and import BTC private keys into it.
We use two different types of custody: top-tier security (for the main 10 currencies and all the ETH tokens) and regular for other currencies. Top-tier security custody is based on HDKey technology. For security reasons, we will not compromise the integrity of private keys in our top-tier custody and it is prohibited by our internal security policies to derive and export private keys from HDKey. Top-tier security custody implements its own cryptographic model to build and sign transactions and does not use any cryptocurrency daemons. Transactions are signed independently, without interacting with blockchain daemons. It’s prohibited by our security policies to run any third-party solutions inside top-tier security custody and export any kind of private keys.
We have been in this business for over half a decade, relying on these security models to ensure the safety of client funds and keep our Custodial Solution as one of the best on the market. The BTCP developers created custodial risk and ecosystem instability for us, its partner exchange. This led us to make the decision to stop deposits and trading of the asset. We call on every project in crypto space to think thoroughly and evaluate possible risks for all users/partners before making controversial business decisions.
We place great importance on proper communication and hope to share the same customer oriented core values and vision with our partners at all times.
HitBTC users did not sustain any losses as a result of this and BTCP is available for withdrawal from the platform.