PwC now audits crypto companies1 min read . Updated: 26 Jun 2019, 03:10 PM IST
- Price of Bitcoin has more than tripled since the start of the year
- Teams across PwC spent the past year designing tools that could match the private keys
Hong Kong: Accountancy giant PricewaterhouseCoopers LLP (PWC) has added cryptocurrency auditing to its list of services as the firm expands into an asset class that is steadily adopting the accoutrements of traditional finance.
Teams across PwC spent the past year designing tools that could match the private keys and public addresses assigned to crypto asset accounts, Ralph Weinberger, head of PwC’s Global Assurance Methodology, Learning and Education Organization, said by phone.
The auditor’s tools can’t access the unique alphanumeric security codes that secure each key, Weinberger said, but they do allow PwC to verify that an entity is the sole owner of the cryptocurrency holdings.
The difficulty of verifying crypto assets is one of several reasons why many institutional investors have steered clear of the space, which has been dogged by examples of fraud, theft and market manipulation. If crypto asset firms can get an audit sign-off from a Big Four accounting firm, it could help alleviate some of those concerns just as the market stages its largest rally since 2017.
The price of Bitcoin has more than tripled since the start of the year, aided by announcements that firms including Facebook Inc. and JPMorgan Chase & Co. plan to start tokens based on the blockchain technology that underpins crypto assets.
Professionally auditing crypto assets has proven challenging, even with calls for greater industry transparency following scandals including missing tokens and regulatory probes. Accountants have struggled to verify the ownership of crypto tokens, and in an industry dominated by start-ups many firms lacked the risk-management and process controls expected by a seasoned auditing firm.
For now, PwC can audit eight tokens, including Bitcoin and Ethereum. Each cryptographic requires its own audit tool given the different blockchains they use, Weinberger said, one reason it took so long to design the technology. The firm used the tools when it audited the accounts of Hong Kong-listed BC Technology Group Ltd., a blockchain investment firm whose units include over-the-counter crypto trader OSL.
This story has been published from a wire agency feed without modifications to the text.
Never miss a story! Stay connected and informed with Mint. Download our App Now!!