Wall Street Demands Crypto Guardrails Amid North Korean Hacker Threats
Digital Asset's Yuval Rooz says financial institutions are increasingly concerned about fiduciary duty to block state-sponsored bad actors, viewing Canton's permissioned design as a potential solution
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- Wall Street firms are increasingly worried about their fiduciary responsibility to prevent North Korean hackers from accessing their systems, according to Digital Asset CEO Yuval Rooz.
- The concern follows the $290 million Kelp DAO hack and rising DeFi exploits.
- Rooz highlighted Canton's 'guardrail' design as a solution that allows participants to control access while maintaining debate over whether such restrictions compromise DeFi's permissionless nature.
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Wall Street firms are increasingly worried about their fiduciary responsibility to prevent North Korean hackers from accessing their systems, according to Digital Asset CEO Yuval Rooz. The concern follows the $290 million Kelp DAO hack and rising DeFi exploits, with North Korean-linked hacking groups sending a shiver through the cryptosphere.
"They have to make sure that bad actors cannot engage with their systems," Rooz told Decrypt. "That's what they're responsible for from their fiduciary duty as a traditional organization."
Rooz highlighted Canton's "guardrail" design as a solution that allows participants to implement restrictions for subnets they create or digital assets they issue. Since the network debuted in 2024, crypto purists have chafed at Canton's design, arguing it's not a "true" blockchain partly because participants can limit users' control.
"Nobody should say that that's a bad thing," Rooz said referring to Arbitrum's decision to freeze $71 million in funds that Kelp DAO's attackers had left exposed. "One of the things that, to me, is pretty interesting about DeFi is that people want all the freedom in the world with none of the risks."
North Korean hackers have stolen over $6 billion in crypto since 2017, per a report from TRM Labs. The ability to decide who has access to applications and keep out potential threats appears to be a key selling point for institutions like stablecoin issuers Tether and Circle.
"Ultimately, the tension between absolute decentralization and safety shows no signs of abating," Rooz said. "And in a world where a single exploit can wreak havoc, Rooz suggested that the ability to flip a switch on bad actors will shift from a controversial feature into a go-to standard."
