While a series of global events have severely undermined trust in cryptocurrencies, some hope to restore that trust by putting in place processes that ensure compliance with certain business standards, such as proper handling of customer data.
Several companies have issued press releases announcing their compliance with Service Control Organization (SOC) Type 2 audits designed to demonstrate a company's data management and security skills.
To find out what this type of security audit means for the industry, Cointelegraph sat down with Eric Lister, director of service delivery at audit firm A-LIGN.
In a statement, Lister highlighted some of the items A-LIGN looked for in this audit, what it means for the crypto space, and how it helps crypto companies perform better. According to Lister. "At a basic level, we are looking at policies and procedures that define business routines that guide business operations."
In addition, the auditor will want to obtain documentation that specifies the controls that ensure the operation of the procedures, as well as the protection of the organization's systems and related data. He says:
Crypto has been plagued with exchange control issues over the last 12 months. A SOC 2 audit allows cryptocurrency companies to demonstrate trust and transparency to their customers, especially when it comes to protecting customer data and assets.
Lister says that a successful SOC 2 audit will demonstrate data and system security. In addition, the executive said, it will also demonstrate the safety of client funds, which is a top concern for clients and government agencies.
Related: BitGo Completes Two More Years of SOC Compliance Certification Following Deloitte Award
While the audit provides security, Lister makes it clear that it does not improve business systems. "SOC certification does not improve business systems, but it does give users and stakeholders peace of mind that controls are in place and working effectively," he explained.
Most of the major crypto companies have passed this test. On July 6, crypto lending firm Nexo announced that it has strengthened its data security following this process. According to Nexo, this event is a new milestone that validates and improves the security of its platform users.
