Collaborative Custody: Tantra Labs + Unchained Capital

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First published: 07/17/2020
| Last updated: 01/17/2023
| -- min read

Unchained Capital is excited to be partnering with Tantra Labs (Tantra), which leverages Unchained’s collaborative custody platform to secure bitcoin held in cold storage.  As a platform, Tantra provides liquidity through algorithmic trading strategies, helping to create more efficient markets within the bitcoin ecosystem while earning yield for their clients. Given the nature of its operations and strategies, Tantra holds a material percentage of its assets offline in cold storage, requiring best-in-class multisignature custody through Unchained Capital. 

Tantra’s team is composed of quantitative researchers, engineers, data scientists, economists, and entrepreneurs with a deep fundamental understanding of bitcoin and a deep conviction that bitcoin will usher in a more prosperous future built on sound money. Tantra has partnered with Unchained to enhance the security of its systems and drive efficiencies within its business by leveraging the strengths of both platforms to drive innovation through the use of collaborative custody, for the benefit of Tantra clients. The collaboration between Tantra and Unchained highlights the value that can be created by two bitcoin-centric businesses with complementary expertise working together. Tantra specializes in algorithmic trading strategies to deliver enhanced yield-based products and Unchained specializes in custody infrastructure and multisig technology solutions. By partnering, Tantra and Unchained are both able to focus investments on their core competencies while delivering greater value to end clients. 

Through collaborative custody, Tantra remains in ultimate control of the assets custodied through its platform and investment funds, eliminating additional layers of counterparty risk while gaining the security benefit of a more diversified and distributed key management architecture. For the bitcoin held in cold storage, Tantra controls 2-of-3 keys and Unchained holds 1-of-3 keys, with Tantra able to rely on Unchained as a backup key holder. Tantra’s keys are geographically distributed to improve security, financial controls, and redundancies, with transactions and signatures coordinated via Unchained’s private application and key management software.

Rather than build its own custody infrastructure from the ground up, Tantra is actively working with Unchained to provide input and feedback into Unchained’s development roadmap. This will ultimately better serve Tantra’s own needs and help tailor solutions that will meet the needs of all bitcoin-based businesses that demand unilateral private key ownership over their bitcoin. While Unchained is a trusted partner, businesses and individuals alike understand there are costs associated with counterparty risk and benefits from preserving the censorship-resistant properties of bitcoin. Collaborative custody and Unchained’s open source Caravan tool collectively remove counterparty risk from the custody equation for Tantra and ensure funds managed by Tantra can always be accessed.

Unlike other yield-based products in the market, prospective clients can evaluate the direct risks associated with the trading strategies deployed by Tantra, allowing for greater transparency, more informed decisions, and a better aligned compensation structure. Rather than work through intermediaries that lend to third-parties, which introduces additional layers of counterparty risk, clients in Tantra products lend directly to Tantra, which executes a number of algorithmic trading strategies to generate return and pay interest. While lending bitcoin bears risk and must be evaluated by each individual, Tantra is expanding the options available to the market in a way that provides a more tangible ability to assess the risk being taken.Unchained is excited to partner with Tantra to facilitate their custody engine. We look forward to finding additional opportunities to further integrate and maximize the value of our two platforms. You can learn more about Tantra on their website, Unchained’s platform, and collaborative custody specifically, is built on the foundation of individuals and businesses holding private keys to advance a more decentralized and secure bitcoin network architecture. Tantra shares this vision and is a welcome addition to a growing bitcoin-native ecosystem on Unchained’s platform. 

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