Why HSMs Are Critical to Digital Asset Security

Banks and financial institutions are expanding into digital assets amid evolving U.S. regulations and adoption by major banks and card networks. But as these assets depend on cryptographic keys stored in wallets and online servers, rising key thefts and financial losses underscore the urgent need for stronger security.

Banks are now turning to hardware security modules, or HSMs, to secure cryptographic keys offline and away from the public internet, said Richard Chiu, head of sales engineering at Thales.

"Growth [in digital asset adoption] introduces risk. Over $2.17 billion dollars were stolen from cryptocurrency platforms in 2025, surpassing all of 2024," Chiu said. "Every digital asset, from cryptocurrencies to tokenized assets, is only as secure as the keys that protect it, and this is now a high priority for banks and other players, as they want to protect their customers' digital assets."

In this video interview with Information Security Media Group, Chiu also discussed:

• Current security challenges in the digital asset ecosystem;
• HSMs as a trusted foundation for securing cryptographic keys;
• Security trends shaping the future of digital finance.

Chiu specializes in architecting best-of-breed cybersecurity solutions that align with customer strategies and support their digital transformation journeys. He has more than a decade of experience in advising enterprises, especially financial institutions, across APAC regions.