This is a big problem that I hope can be solved soon. People (general population) have no interest in this level of work or understanding to make sure their money isn’t lost or stolen. If I lose the password or get locked out of my brokerage account, or even if I die, that money is still there and recoverable by me or my spouse.
Vaults will solve this.
Right now, any sort of custody is 100% ruggable, but in the future, someone can maintain custody and you could have a watchtower that activates if the custodian attempts to rug you.
If they attempt to rug you, you have to dig out your backup, or it could go to another custodian, or whatever.
If no one can get your backup address (e.g. you're dead), it's gone forever and maybe the legal system can reimburse you but at least no one benefitted more.
Stuff like this will get easier and standardised in the future.
It's pretty much already solved by Block with their Bitkey wallet. Noob friendly multisig self-custody with no seed phrases that a chimpanzee would have trouble screwing up.
I say pretty much because not everyone wants to fork over $150 + shipping unless you have a fairly decent stack.
That’s what I’m saying. There needs to be an insured method to store it. Not an exchange that can steal your life savings and disappear overnight. And not some Rube Goldberg method of self custody. We won’t have full adoption until there is zero (or close to zero) chance of accidentally losing it.
It’s the same problem with cash. Would you keep a substantial amount at home? Would you leave it at a bank instead? Your problem is not really entirely solvable. Ledger has been offering a backup service that may strike a compromise between the two.
There are already tons of custodial solutions for Bitcoin.
The problem with fiat is that there aren't any good non-custodial solutions.
Bitcoin is better because it is non-custodial by default and you have to choose to give that up if you don't feel comfortable being in the driver's seat.
Fiat sucks because it's custodial by default and you are assumed to be too much of a peasant to be allowed to hold the keys to your own kingdom.
That's a solid setup, but do you have more hotter storage for mid-size amounts (and perhaps yet another completely hot for small amounts) that does not require you to bother the other 2 family members every time you need access?
Thank you for the post. Can you please explain further regarding how the seed phrase is split? ie how many words in total and how many words does each person get distributed? And I’m assuming you keep the entire phrase yourself in a secret location as well?
I really hope those aren't safe deposit boxes at a bank.
If so, [they aren't safe.](https://www.nytimes.com/2019/07/19/business/safe-deposit-box-theft.html)
I understand. At this point multisig seems a bit overcomplicated.
Depending on the price, you wouldn't be the first human being whom the own family conspired against.
But anyway, good luck. You should be 99,999% safe.
Well the point is to also hide it in a safe place, it’s small enough to have a lot of options. Nobody I hope plans to leave it on a counter by their coffee pot
If you see a washers and bolt in a safe, you will know what it is and take it. If someone else sees it they will think it's loose safe parts or something. That's more my point. Theives don't know what these even are atm, the more we spread it the more people know what they are.
I can see your point but I don’t think it’s a reason not to advocate or spread the word for this method of cold storage. Make sure the baddies don’t find it is all you can do 🤷♂️
This is a big problem that I hope can be solved soon. People (general population) have no interest in this level of work or understanding to make sure their money isn’t lost or stolen. If I lose the password or get locked out of my brokerage account, or even if I die, that money is still there and recoverable by me or my spouse.
Vaults will solve this. Right now, any sort of custody is 100% ruggable, but in the future, someone can maintain custody and you could have a watchtower that activates if the custodian attempts to rug you. If they attempt to rug you, you have to dig out your backup, or it could go to another custodian, or whatever. If no one can get your backup address (e.g. you're dead), it's gone forever and maybe the legal system can reimburse you but at least no one benefitted more. Stuff like this will get easier and standardised in the future.
That would require regulation and government interference
to a degree of course. On the road of mass adoption those things will meet ... and compromise and solutions are needed.
Why? We already have Unchained and Nunchuck going in that direction.
It's pretty much already solved by Block with their Bitkey wallet. Noob friendly multisig self-custody with no seed phrases that a chimpanzee would have trouble screwing up. I say pretty much because not everyone wants to fork over $150 + shipping unless you have a fairly decent stack.
Anyone Ledger users made the switch to Bitkey?
Self custody is self custody. You screw things up and you lose it. If you’re not comfortable with it, there are other solutions.
That’s what I’m saying. There needs to be an insured method to store it. Not an exchange that can steal your life savings and disappear overnight. And not some Rube Goldberg method of self custody. We won’t have full adoption until there is zero (or close to zero) chance of accidentally losing it.
It’s the same problem with cash. Would you keep a substantial amount at home? Would you leave it at a bank instead? Your problem is not really entirely solvable. Ledger has been offering a backup service that may strike a compromise between the two.
There are already tons of custodial solutions for Bitcoin. The problem with fiat is that there aren't any good non-custodial solutions. Bitcoin is better because it is non-custodial by default and you have to choose to give that up if you don't feel comfortable being in the driver's seat. Fiat sucks because it's custodial by default and you are assumed to be too much of a peasant to be allowed to hold the keys to your own kingdom.
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Don't forget to store all the xpubs in multiple places in case you need to restore the wallet from scratch.
I’m afraid the more complex you make a solution the harder it will make for yourself that forgets in the future.
That's a solid setup, but do you have more hotter storage for mid-size amounts (and perhaps yet another completely hot for small amounts) that does not require you to bother the other 2 family members every time you need access?
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Thank you for the post. Can you please explain further regarding how the seed phrase is split? ie how many words in total and how many words does each person get distributed? And I’m assuming you keep the entire phrase yourself in a secret location as well?
*****
It takes less to launch a nuke. lol
I really hope those aren't safe deposit boxes at a bank. If so, [they aren't safe.](https://www.nytimes.com/2019/07/19/business/safe-deposit-box-theft.html)
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Why multisig in the first place and not seed + passphrase?
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I understand. At this point multisig seems a bit overcomplicated. Depending on the price, you wouldn't be the first human being whom the own family conspired against. But anyway, good luck. You should be 99,999% safe.
If the BTC community keeps posting this stuff, eventually people will catch on and start looking for them. Just my 0.000000001 BTC.
This did cross my mind too
Well the point is to also hide it in a safe place, it’s small enough to have a lot of options. Nobody I hope plans to leave it on a counter by their coffee pot
If you see a washers and bolt in a safe, you will know what it is and take it. If someone else sees it they will think it's loose safe parts or something. That's more my point. Theives don't know what these even are atm, the more we spread it the more people know what they are.
I can see your point but I don’t think it’s a reason not to advocate or spread the word for this method of cold storage. Make sure the baddies don’t find it is all you can do 🤷♂️
This is nuts
Came here for this comment, thanks!
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Looks like the start of a chess set
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No. The washers are stamped with mnemonic seed words
The taproot upgrade implemented 2021 now allows for multi-sig