Announcing Tungsten Custody

Tungsten Custody, a leading UAE-based crypto custodian and a portfolio company of Further Ventures, backed by one of Abu Dhabi’s largest Sovereign Wealth Fund, ADQ, has chosen Dfns as its wallet infrastructure provider in a landmark partnership. This collaboration is not only a technical integration, it also marks a step forward in the UAE’s digital asset ecosystem by adding more diversity and deeper security, compliance, and innovation across the sector.

By using Dfns' advanced wallet infrastructure, Tungsten strengthens its institutional financial services. It delivers a seamless and secure user experience, a compliance-ready key management system, broader blockchain connectivity, access to higher yields, and fast, reliable token management across any blockchain—all from the UAE. The service appeals not only to local investors but also to international funds and investors seeking the security and regulatory advantages of managing assets in the UAE.

This partnership positions Tungsten to solidify its role as a market leader, accelerating growth locally and globally. In this blog post, we discuss the importance of this collaboration and its effect on Tungsten’s progress and the broader crypto industry.

Tungsten, the new powerhouse of crypto custody

Tungsten Custody is a newly regulated, UAE-based financial institution specialising in secure digital asset custody for institutional clients. True fact: it is actually the first crypto custodian to get licensed by both the Financial Services Regulatory Authority (FSRA) in Abu Dhabi Global Market (ADGM) and have offices in both Dubai and Abu Dhabi, guaranteeing reliability across the region by operating in multiple jurisdictions with strong physical controls.

Clients include institutional investors, crypto miners, trading firms, ETP providers, blockchain foundations, venture funds, and exchanges. Tungsten’s adaptable services support diverse investment strategies, combining advanced security and seamless integration to protect assets and enhance value. They offer well-insured custody services with offline storage for maximum security. All transactions are processed and approved through Tungsten’s team under strict security protocols. A dedicated Trust Office delivers personalised, white-glove custodial services tailored to individual client needs.

Led by José J. Pérez Aguinaga, former Head of Custody at Amina Bank, and supported by giants ADQ and Further Ventures, Tungsten Custody has built a reputation as a trusted leader in institutional digital asset finance. What impresses us most is their proactive approach to regulatory engagements. They’ve worked more closely with regulators than anyone else we’ve seen so far, tackling complex compliance challenges with FSRA and VARA step by step, and relentlessly pursuing solutions that benefit all stakeholders.

How Tungsten outpaces the competition with Dfns

Dfns' wallet infrastructure makes institutional asset management easier by simplifying the handling of diverse and complex portfolios. With strong support for dozens of emerging Layer 1 blockchains, like Cosmos and its appchains or the Telegram Open Network, Tungsten Custody enables clients to explore opportunities across multiple networks. Using Dfns’ single API and dashboard, Tungsten connects with all blockchain endpoints, including lesser-known ones, cutting implementation time to just three weeks—a rare efficiency for custodians.

As blockchain technology evolves rapidly, institutions need adaptable infrastructure to seize new opportunities quickly. Dfns delivers this agility with advanced key management technology and deep cryptographic expertise. Our engineering and research teams develop state-of-the-art mathematical protocols, algorithms and libraries for production, ensuring mastery over the entire key management lifecycle. For example, as an outcome, Dfns’ support for Taproot and Schnorr enables Tungsten to manage advanced Bitcoin projects like Babylon BTC staking, which allowed them to expand their services and attract the most sophisticated institutional investors. 

The Dfns Key Management System (KMS) is designed for versatility, supporting:

• ECDSA: A widely adopted standard.
• EdDSA: A modern, efficient cryptographic standard.
• Schnorr: Known for its efficiency and multi-signature support.
• STARK Curve: Tailored for zero-knowledge proofs and scalability.
• Bitcoin Taproot: Boosting Bitcoin’s privacy and scalability.
• SLIP and BIP Derivations: Essential for hierarchical deterministic wallets.

As Dfns integrates with over 100 third-party applications, including exchanges, staking providers, payment systems, accounting tools, and others, Tungsten benefits from enhanced capital efficiency, regulatory compliance, and seamless interoperability, all within Dfns' secure framework and strengthened by Tungsten. Additionally, Dfns bridges traditional and digital finance by integrating with established banking systems like Temenos or complementary vendors with a strong presence in the UAE (e.g., Hashnote, Fuze, Twinstake, Kemet, etc.), creating a unified platform for modern financial operations.

Modern technology, rooted in regulatory integrity

Dfns' Wallet Entitlement Management System helps Tungsten create robust security policies and streamline operations. This system allows Tungsten to build a strong, multi-layered security framework tailored to institutional needs:

• Eliminating Single Points of Failure: Multi-approver root quorums ensure that no single person can alter sensitive infrastructure, protecting against internal and external threats.
• National Sovereignty: Tungsten operates data centre clusters in the UAE.
• Segregation of Duties: Employees use Yubikeys for platform access, creating unique cryptographic records. Immutable activity logs provide full oversight, supporting compliance and audit requirements.
• Policy Engine with KYT: Tungsten integrates Elliptic KYT (Know Your Transaction) streams into its policy engine, flagging transactions for review and assessing exposure to risky wallets to ensure compliance with AML and CTF regulations.
• Secure Governance with Root Quorums: Governance actions require multi-party permissions, cryptographically-attested approvals, preventing any single actor from overriding critical settings. This safeguards Tungsten’s infrastructure from accidental or intentional mismanagement.

Key security is a matter of national security  

The flexibility of Dfns' Key Deployment Service (KDS) enables Tungsten Custody to adapt its key management infrastructure to meet institutional needs:

• Customizable Multi-Party Computation (MPC): Tungsten can set custom threshold parameters, select from different algorithms, and deploy across multiple regions, balancing security and operational efficiency.
• HSM Integration with Top Providers: Through partnerships with leaders like Thales, IBM, Yubico, and Securosys, Dfns allows Tungsten to leverage top-tier hardware security solutions for its custodial operations.
• Know Your Key (KYK) Tracking: Dfns' KYK features provide Tungsten with detailed visibility into key storage environments for each wallet, ensuring clarity and compliance with regulatory requirements.

A standout achievement of this collaboration is the successful deployment of cryptographic keys on-premises in the UAE. While others have faced challenges in accomplishing this level of sovereignty, Dfns and Tungsten locked down a secure and compliant solution. This approach strengthens data sovereignty, a critical need for institutions managing high-value digital assets, and aligns with the UAE's regulatory and security priorities. By hosting cryptographic keys within its jurisdiction, Tungsten enhances sovereign control, reduces reliance on external providers, and ensures compliance with standards set by the FSRA (Financial Services Regulatory Authority) in Abu Dhabi Global Market and even VARA (Virtual Asset Regulatory Authority) in the Emirates of Dubai. This deployment showcases not just technical expertise but Tungsten’s dedication to supporting the UAE's vision for digital asset leadership.

The UAE, a new gravity center for crypto finance

This partnership is a step forward for Tungsten Custody, Dfns, and the UAE’s digital asset ecosystem. It highlights the UAE’s dedication to becoming a global leader in digital finance by focusing on security, innovation, and regulatory excellence. By combining Tungsten’s local expertise with Dfns’ advanced technology, this collaboration sets a new standard for institutional digital asset management. It proves that with the right partnerships, challenges like scalability, security, and compliance can be successfully addressed to build a robust and forward-thinking financial ecosystem.

• Learn more about Tungsten Custody’s financial services at tungsten.ae.
• Explore Dfns’ wallet infrastructure solutions at dfns.co.