Symptoms
Smartobject execution fails with error: "The underlying connection was closed: Could not establish trust relationship for the SSL/TLS secure channel.
Diagnoses
K2 makes a REST call to SharePoint online when executing smartobjects. An SSL certificate somewhere in this process is likely not valid, or not seen as valid. We ran fiddler on the K2 server as the K2 service account in order to determine the cause of the failure. We found that when an SSL tunnel was created to trust.k2.com, the certificate was seen as invalid.
Resolution
We noticed that the trust.k2.com certificate was signed by GoDaddy, and checked the certificate store on the K2 server. We found no trusted root certificate for GoDaddy was installed. We found the needed certificate through https://certs.godaddy.com/repository, and installed the "GoDaddy Class 2 Certification Authority Root Certificate - G2". After adding this certificate explicitly to Trusted Root Certification Authorities, we found that smartobjects were successfully able to execute against SP Online, and we were able to access the K2 application via SP Online.