Clapp Glossary: Qualified Custody📚
💡In plain English, qualified custody means a properly regulated company holds your crypto using bank-level security standards. For example, Clapp uses Fireblocks, a qualified custodian, to secure all collateral.
In crypto, if private keys are lost or stolen, your assets are gone forever — no do-overs. Qualified custodians store private keys securely on behalf of asset owners. They operate under strict financial regulations, keep client assets segregated from their own corporate funds (bankruptcy remote), and undergo regular third-party audits like SOC 1 and SOC 2.
Fireblocks employs MPC (Multi-Party Computation) technology, meaning private keys are split into cryptographic shares across isolated devices — eliminating single points of failure. That's the peace of mind qualified custody provides.