'Big 4' Auditor KPMG Launches Crypto Asset Management Tools

KPMG has built a suite of tools designed to help both traditional financial companies and fintech startups provide tightly managed crypto-asset services.

Targeting institutional clients, the new KPMG Chain Fusion product lets customers manage their data in compliance with regulations around financial reporting, security and processing needs. The suite allows these customers to collect and organize data from both traditional systems as well as blockchain databases, the company announced Monday.

Sam Wyner, director and co-lead of the Big 4 auditor's Cryptoasset Services team, told CoinDesk his team had been working on the project for about a year, building the actual suite of tools since February.

"It’s not unusual for a bank to have tens of systems ... and crypto companies have a similar problem where for their blockchain-based systems, they’re fundamentally different, the infrastructure behind them is fundamentally different from what’s happening in traditional systems," he said. "The same problem that happens is ‘how do you connect all your blockchain based systems to traditional ones, and do that in a way that the organization is trying to operate in?'"

Chain Fusion's core service essentially creates a standardized data model for all transactions that an organization conducts, he said, regardless of whether they're an on-chain/off-chain blockchain transaction or a traditional fiat one.

This allows these entities to run "advanced analytics" on the data. To demonstrate this capability, KPMG built multiple use case modules based around actual feedback from companies in the industry, he said.

One example is ensuring the data on a blockchain matches the information recorded on an entities books, he said.

"If you know you control an address and you think you have one bitcoin on it and you look at the address on the public blockchain, do you have one bitcoin or are you running a fractional reserve?" he said.

Other challenges included finding ways of being able to pull data from databases, including blockchain information, and still be able to run queries.

"We developed it all in a way that we were able to incorporate different types of technology providers and market data and infrastructure providers," Wyner said.

Wyner declined to say how many companies have already begun using Chain Fusion, saying only that KPMG was discussing the product with "multiple clients or potential clients."

While he wouldn't say that KPMG's name or reputation by themselves necessarily help companies become more comfortable dipping their toes into crypto-asset management, he did note that risk is not new in the financial services industry, and process risk and control are two areas with which KPMG is comfortable.

"At least in my career, this is one of the first times I’ve really thought of something and carried it all the way to this point with the help of a lot of people on this team, it would never have been possible without the support of our team," Wyner said. "It’s an exciting time, I’m excited to continue to speak about chain fusion with all of the companies."