In a significant move to bolster cryptocurrency security and transparency, U.S.-based financial services company Square has open-sourced its proprietary Bitcoin (BTC) cold storage solution. The announcement, made on October 23, 2025, marks a pivotal step in promoting enterprise-grade security standards across the digital asset ecosystem.
The newly released solution, named Subzero, is now publicly available on GitHub, complete with full documentation, source code, and implementation tools. Designed specifically for institutional use, Subzero reflects Square’s long-term commitment to secure, scalable, and auditable cryptocurrency infrastructure.
What Is Subzero?
Subzero is an enterprise-level, offline Bitcoin wallet system engineered to protect private keys from online threats. By leveraging hardware security modules (HSMs) and air-gapped environments, the solution ensures that sensitive cryptographic material never touches an internet-connected device during transaction signing.
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HSMs are specialized hardware devices widely used in the financial sector to safeguard encryption keys and perform cryptographic operations securely. Known for their resistance to physical tampering, robust access controls, and secure key replication features, HSMs provide a natural fit for high-value cryptocurrency custody.
Square’s integration of HSM technology into Subzero enhances both security and operational resilience—critical factors for any organization managing large-scale digital asset holdings.
How Subzero Works: A Multi-Layered Security Approach
At the core of Subzero’s design is a strict separation between online and offline systems. This architecture minimizes attack surfaces by ensuring that no private keys are ever exposed to networked environments.
Here’s how the signing process works:
- An online server generates a transaction and encodes it into a QR code containing only the essential data needed for signing.
- The QR code is physically scanned by an authorized operator using an air-gapped device.
- The offline device processes the request within the secure HSM environment and signs the transaction without exposing the private key.
- The signed response is then sent back via another QR code to the online system for broadcasting to the Bitcoin network.
This method ensures minimal data transfer while maintaining maximum security—a principle known as data minimization in cybersecurity circles.
Additionally, Square implemented multiple layers of protection:
- Restricted transaction destinations: The cold wallet is programmed to send funds only to pre-approved hot wallets controlled by Square, reducing the risk of unauthorized withdrawals.
- Multi-signature authentication: Users must authenticate transactions using a combination of smart cards and passwords, enforcing dual control.
- Physical and procedural safeguards: Access to signing servers is restricted to secure, undisclosed locations with strict operational protocols.
These measures collectively create a defense-in-depth strategy that aligns with best practices in financial cryptography.
Leveraging Open Source for Trust and Innovation
By open-sourcing Subzero, Square aims to encourage peer review, community contributions, and broader adoption of secure custody practices. Transparency is key in building trust—especially in decentralized ecosystems where users rely on verifiable code rather than institutional assurances.
The project draws inspiration from established open-source initiatives like Trezor-Crypto, a well-regarded library developed by the hardware wallet provider Trezor. Square integrated components from this project to strengthen Subzero’s cryptographic foundation, ensuring compatibility and reliability.
Open-sourcing such critical infrastructure also invites collaboration from developers, auditors, and enterprises worldwide. This collaborative model accelerates innovation while raising the overall security baseline for the entire industry.
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Industry Momentum: A Growing Trend Toward Open Collaboration
Square’s move follows a broader trend among financial institutions embracing open-source development. Just one day prior, on October 22, 2025, Dutch banking giant ING announced the release of its own open-source privacy enhancement tool for blockchains—Zero-Knowledge Set Membership (ZKSM).
ZKSM allows financial institutions to verify specific data points (such as membership in a trusted entity list) without revealing underlying sensitive information. Like Subzero, it demonstrates how traditional finance players are adopting blockchain-native principles to improve transparency and privacy.
This growing momentum underscores a shift: instead of treating security as a proprietary advantage, leading companies are recognizing that collective progress benefits everyone in the ecosystem.
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Frequently Asked Questions (FAQ)
Q: What is Bitcoin cold storage?
A: Cold storage refers to keeping cryptocurrency private keys offline to protect them from hacking attempts. It’s one of the most effective ways to secure digital assets against remote cyberattacks.
Q: Why did Square open-source its cold wallet solution?
A: By releasing Subzero as open-source software, Square promotes transparency, enables third-party audits, fosters innovation, and helps raise global security standards for cryptocurrency custody.
Q: Can individuals use Subzero?
A: While Subzero is designed for enterprise use, technically proficient users may adapt parts of the system. However, it requires HSM hardware and advanced operational knowledge, making it best suited for organizations.
Q: How does multi-signature authentication work in Subzero?
A: Subzero requires both a smart card and password to authorize transactions. This dual-factor mechanism ensures that no single point of failure can compromise fund security.
Q: Is Subzero compatible with other cryptocurrencies?
A: Currently, Subzero is tailored exclusively for Bitcoin (BTC). Its architecture focuses on BTC’s specific transaction structure and scripting language.
Q: Where can I access the Subzero code?
A: The full source code, documentation, and tools are hosted on GitHub at github.com/square/subzero—freely available for review and contribution.
With this release, Square reinforces its role as a bridge between traditional finance and decentralized technologies. By prioritizing security, transparency, and collaboration, the company sets a new benchmark for how digital assets should be stored—and protected—in the modern era.