Google Creates Crypto Asset Protection System for Banks

5 Min Read Tags:

  • Google has announced a preview of a multi-party computation system designed to help financial institutions secure cryptocurrencies and tokenized assets.
  • The system splits cryptographic keys across independent environments, reducing the risk of loss if one device is compromised.
  • Google plans a commercial launch in early 2027; several major financial institutions are testing the product, while Alphabet is using it for assets on Ethereum and Solana.

Google has announced a preview of Google Multi-Party Compute, or MPC, ahead of a planned commercial launch in early 2027. The system is intended to help banks and other financial institutions secure cryptocurrencies and tokenized assets used in payments, tokenization and custody services.

Google will present the technology at its first symposium dedicated to digital assets in New York, CoinDesk reported. Pricing has not been disclosed.

The product is in closed testing with several major financial institutions. Google’s parent company, Alphabet, is also using the technology to protect its own digital assets on the Ethereum and Solana networks. Google has not identified the participating institutions or disclosed which Alphabet assets the system protects.

“Digital asset adoption and tokenization are at an inflection point. As regulated financial institutions begin adopting blockchains and tokenization, they need scalable, proven infrastructure to secure their clients’ assets,” said Rich Widmann, Google Cloud’s head of digital assets strategy.

How Google MPC works

Multi-party computation divides a cryptographic key among multiple independent systems, removing the need to keep the full private key in one location. That structure reduces the risk of asset loss if an individual device is compromised.

A bank could, for example, store separate parts of a key in Google Cloud, on its own hardware and with another cloud provider. Before signing a transaction, the system uses Google Confidential Space, a secure environment, to check whether the transaction complies with predefined rules.

Available controls include maximum transfer limits, recipient-wallet verification and mandatory approval by multiple departments. Institutions can also require signatures from two of three, or five of seven, authorized parties and use a key-recovery process if access is lost.

According to Google, customers retain control of their cryptographic data, while the company cannot access it in unencrypted form.

Google previously published recommendations for using MPC and Confidential Space to protect digital assets. The new product combines those capabilities with transaction policies and key recovery in a specialized service.

Private-key, AI and quantum risks

The announcement follows substantial crypto-industry losses linked to hacking. According to CoinGecko, crypto platforms lost $3.63 billion to attacks from the beginning of 2025, with supply-chain attacks, smart-contract exploits and private-key compromises among the biggest threats.

DeFiLlama data cited by CoinDesk put cumulative crypto-industry losses from hacks at $16.69 billion as of June 2026. About 40%, or roughly $6.7 billion, resulted from attacks related to private-key compromise.

In March 2026, the Resolv protocol lost about $25 million because of a compromised privileged key and flaws in its issuance mechanism. In June, attackers stole more than $32 million from at least 17 Humanity Protocol wallets. The project’s token subsequently fell by more than 80%.

Artificial intelligence has created a separate concern. Chainalysis found that in 2025, crypto schemes linked to AI tool providers generated an average of $3.2 million per operation, compared with $719,000 for schemes without such a link. The research did not establish that AI directly caused the difference in revenue.

Ethereum researcher Justin Drake has also warned that future AI systems could potentially find mathematical methods to break cryptographic signatures. However, no AI system has demonstrated an ability to break Bitcoin or Ethereum cryptographic signatures. Google MPC primarily addresses compromised keys and unauthorized transactions rather than a hypothetical break of the underlying cryptography.

Google said the system could transition to post-quantum algorithms in the future without a complete overhaul. Support for ECDSA and Ed25519 is planned for the commercial launch, but Google has not set a timetable for post-quantum signatures.

Source: Incrypted

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