In the field of digital assets, coinex stores over 95% of its users’ assets in offline cold wallet systems. The private keys of these wallets are physically isolated and distributed across multiple high-securitization data centers worldwide, effectively reducing the hacker attack surface by more than 99%. According to the 2023 third-party security audit report, its cold storage solution has passed the CC EAL 5+ level certification. The hot wallet retains less than 5% of the total assets as liquidity to handle daily transactions. This architecture ensures that even in the event of extreme network intrusions, the probability of user principal loss is less than 0.01%. Looking back at the catastrophic event in 2014 when the Mt. Gox exchange lost 850,000 bitcoins due to a security vulnerability, coinex adopted a completely opposite multi-signature and sharding key management technology. Any large withdrawal requires at least three authorized personnel to pass biometric verification, keeping the internal crime risk below one in ten thousand statistically.
At the active defense level, coinex has deployed a real-time risk control system capable of analyzing over 100,000 transactions per second. This system employs behavioral biometric recognition and machine learning models, which can identify abnormal logins at a millisecond-level speed with an accuracy rate as high as 99.8%. For instance, when the system detects that the user’s login IP address, device fingerprint or operation habits have a deviation of more than 0.5 from historical samples, it will automatically trigger a secondary verification, successfully blocking over 98% of fraudulent attempts in 2022. This system refers to the anti-fraud model of traditional banking, but its processing speed has been increased by 50 times. It processes over 2TB of data traffic daily. By analyzing more than 100 risk parameters, the incidence of currency theft incidents has been reduced by 35% year-on-year.
In terms of compliance and financial transparency, coinex regularly conducts 100% reserve proof, which is verified monthly by top third-party auditing institutions to ensure that users’ assets are held in full at a 1:1 ratio. Its publicly disclosed Merkle root hash value can be independently verified by all users. Since global regulation tightened in 2021, coinex has obtained more than five national licenses, including the MSB in the United States. Its compliance costs have increased by an average of 20% annually, but the user fund security insurance coverage has also risen to 500 million US dollars simultaneously. For instance, compared with the FTX collapse in 2023 due to the misappropriation of user assets, coinex established a trust level far exceeding the industry average through strict financial segmentation and on-chain verifiable audits. As a result, its net inflow of user funds increased by 15% against the trend in the following quarter.
In terms of technical architecture and innovation, coinex’s independently developed SafeGuard system has achieved a zero-trust environment throughout the entire lifecycle of private key generation, storage, and usage. The physical tampering response time of its hardware security module is less than 0.1 seconds. By adopting threshold signature technology and secure multi-party computation, neither a single device nor an individual can independently control assets, reducing the risk of private key leakage from a technical perspective to zero. Referring to the wave of technological upgrades in the industry following the major security incident that KuCoin encountered in 2020, coinex has invested over 30% of its annual R&D budget in security innovation, reducing the number of vulnerabilities discovered in third-party penetration tests on its platform by 60% year-on-year and achieving a core system availability of 99.99%.