Safello Co-Founder Moves to Tokyo to Start New Bitcoin Security Firm

The co-founder of Swedish exchange Safello has left the company to join a team of bitcoin security experts in establishing a new Tokyo-based consulting firm.

The move should also see him assisting the investigation into Mt Gox's missing bitcoins.

Emil Oldenburg, who was also Safello's chief technology officer, left Sweden just last month and is now an official co-founder at WizSec, a new startup that has been performing unofficial analysis of Gox's transaction records.

Oldenburg told CoinDesk he was looking for something different after launching Safello in August 2013. A love of Japanese pop culture and a desire to return to his infosec roots drove him to make a quick decision on a chance offer.

He said:

"I saw an opportunity in Japan and decided I needed to act now, as it wouldn't be there forever."

Oldenburg met Wizsec's chief hacking officer J. Maurice at the Tokyo Bitcoin Meetup while on vacation in spring. The two got talking about security issues, and Oldenburg received an offer almost immediately.

Maurice said the engineer, who had racked up more than two years as a systems security specialist at Nasdaq OMX in Europe, was a catch for his fledgling company.

"Our goal is to recruit the most elite hackers from all over the world, so we're honored to have Emil come join us to co-found our bitcoin security firm."

Safello in Europe

Safello

operates a Europe-wide exchange serving all countries of the European Union plus Norway and Switzerland, leveraging Swedish banks' comparatively liberal attitude towards cryptocurrency businesses, and Europe's SOFORT instant payments system to serve its clients.

The company received its initial $600,000 backing from bitcoin veterans Erik Voorhees, Roger Ver and Blockchain CEO Nicolas Cary. A further $250,000 investment came in July via Barry Silbert's Bitcoin Opportunity Corp.

Seeing Japan up close

Despite the long-distance relocation, Oldenburg remains a shareholder in Safello and still has a keen interest in the exchange business.

A manga and Japanophile since his teenage years, Oldenburg had helped organize Japan-themed conventions in his native land, festivals that attracted thousands of cosplaying Swedes to peruse Japanese merchandise, games, and other cultural exports.

"I'd studied the language in school and wanted to learn the language for real," Oldenburg added.

WizSec and the Gox connection

In November, San Francisco-based Kraken launched its local Japanese exchange, announcing immediately after that it had been selected by bankruptcy trustee Nobuaki Kobayashi to assist him and the Tokyo Metropolitan police in their investigation into what became of Mt Gox's 650,000 still unaccounted-for bitcoins.

WizSec has since signed a non-disclosure agreement (NDA) with Kraken, which prevents the company from discussing its current work, though it can be assumed it will involve Mt Gox somehow.

The founding team, which then consisted of Maurice, colleague Kim Nilsson and Gox creditor advocate Daniel Kelman, earlier this year took the personal challenge of analyzing the "ticker-tape" of Gox transaction information that had become publicly available through hacks, leaks and IRC chats.

This was despite the fact that the Japanese police were keeping all official Mt Gox transaction and customer data behind closed doors, unavailable for public examination.

Rising demand for bitcoin security

WizSec, which Maurice started after leaving IT firm Wiz Technologies in order to focus exclusively on bitcoin business, used its reconstructed Gox data to form new theories on what may have happened to the funds.

While the Mt Gox investigation looks likely to be WizSec's primary task, the company is also busy signing up other clients for security-related jobs involving audits and pen-testing.

Maurice, who also played a part in battling Roger Ver's would-be hacker/blackmailer in May, said these incidents had all led to a big increase in demand for security consulting in the cryptocurrency field.

"As Mt Gox taught us, the most important thing in bitcoin is to not get hacked, or to build systems that don't require such trust in the first place, and that's what our firm will help new bitcoin startups with."

"We're building secure infrastructure from the beginning, so we can prevent another epic failure like Gox from ever happening again," he said.

WizSec team image by Jon Southurst