SBIR Phase I: Quantum Resistant Cloud-Based Vault Service for Cryptocurrency Key Backup and Recovery

The broader impact/commercial potential of this Phase I Small Business Innovation Research (SBIR) project is to significantly reduce the economic and national security threats posed by the persistent theft of billions in digital assets by cyber criminals and adversarial nation states. This project solves the problem of private key mismanagement as one of the most common attacks suffered by investors, digital asset custodians, businesses and law enforcement agencies.

This project’s innovation will address the technical challenge of secure and privacy-preserving cryptographic key management. Current key backup and recovery (KBR) products are cost-prohibitive, expose keys to third parties, and have recovery processes which can take up to 48 hours. This project will develop a cloud-based vault that utilizes quantum-resistant cryptography that securely stores cryptocurrency keys while guaranteeing privacy and a faster recovery process.

Fundamental scientific advancements from this project will demonstrate the potential of quantum-resistant KBR, and will lead to advancements in public key infrastructure. Commercialization efforts will lead to a new product that provides crucial support to target markets, including institutional investors and government investigators. This, in turn, will lead to improved economic competitiveness, national defense, and enhanced STEM (Science Technology Engineering and Math) workforce development by advancing the field of cryptography.

This SBIR Phase I project proposes to address digital asset security risks stemming from improper key management by demonstrating the technical feasibility of a cloud-based vault service (CBVS) utilizing multiple concurrent cryptographic protocols, including quantum-resistant threshold fully homomorphic encryption (FHE). The system will enable cryptocurrency keys to be securely stored, sharded, distributed among multiple data centers or commercial cloud providers and instantly reconstituted at will.

This research aims to optimally integrate and implement FHE into the design of the CBVS to ensure efficient and secure processing, storage and recovery of secret keys while maintaining privacy and preventing third party key exposure. This includes defining the data model, encryption schemes, access controls and authentication mechanisms to protect private keys from unauthorized access or exposure while striking a balance between security and usability.

A comprehensive, scalable key management system will be developed within the vault to enable users to securely generate, store and retrieve private keys as needed while enforcing strict access control and maintaining an audit trail for key operations. By addressing key technical challenges and reducing technical risk, this research will pave the way for a commercially viable and impactful product that can revolutionize the cryptocurrency security landscape.

This award reflects NSF's statutory mission and has been deemed worthy of support through evaluation using the Foundation's intellectual merit and broader impacts review criteria.