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223 sats \ 2 replies \ @k00b 20h \ on: How do you hedge self-custody? bitcoin
I think collaborative custody is the way to go for anyone that we'd recommend "hedging" to:
- "hedge" by having a company control one key
- dedicated software, handholding, and customer support
- most naive attacks will be unsuccessful
I've in the past helped designing secure (p2sh) multisig protocols for one of the collaborative custody providers and that implementation has tons of users. Real examples I've been confronted with the past decade that can happen when you lost a key and then find that:
- Sanctions against your country have been introduced
- KYC rules for your country/state have changed or you moved to another state
- New rules around using Chainalysis flag your coins
These companies commonly won't break the law for your coin, so be very careful when you consider this.
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The reason I went straight to using a custodian is that the collaborative custody services all feel very very close to custodianship to me.
The primary benefit of a collaborative custodian presumably is that they can't rug you. This is only true if you have control of the quorum of keys.
If you don't have a quorum, then you really really need to do the digiligence on who the third party is (how do you know the third-party keyholders won't collude? how do you know they are even that separate of entities?).
If you do have a quorum, then aren't you just better off keeping a backup key in a safe somewhere or giving it to a trusted friend, family member, lawyer).
I can be convinced the concept is misguided, though. It's more an interest in why self-custody isn't taking off and the somewhat elevated base-level of anxiety I carry with regard to my own efforts at self-custody.
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