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# 👁️‍🗨️ Watch-Only Wallets: the functional present of observing without touching… and the future?

Today, a *watch-only wallet* plays a discreet yet solid role: it allows you to **see balances, transactions, and generate addresses without access to private keys**.

Its current use is well-defined:
- Monitoring cold storage funds.
- Handling audits and financial records.
- Role separation (operator vs signer).
- Building PSBTs (*Partially Signed Bitcoin Transactions*) for offline signing.
- Overseeing multisig configurations without custody.

In this context, they serve as **passive verification tools**, ideal for users who embrace self-custody and value separation between observation and control.

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## 🔄 But… what if we pause to consider what they're not doing?

### What happens when individuals or companies demand:

- Secure alerts for large incoming transactions.
- Predictive review of transactions before signing.
- Automated signature workflows across multiple decentralized nodes.
- Intelligent assistants that monitor multiple wallets without ever signing?

That’s where the *watch-only wallet* shifts from being a viewer to becoming **a critical intermediate layer**—able to interact with external tools, provide context, and perhaps assist in making pre-signature decisions.

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## 📉 What’s *not* happening (yet)

Few projects are truly exploring this layer. *Watch-only wallets* remain attached to static UIs (like Sparrow, Electrum) or accounting roles.

- Where are the modern APIs for watch-only querying without compromising privacy?
- Where are the multi-chain dashboard modules that respect xpubs (*extended public keys*) securely?

Truth is, **innovation has focused on signing, custody, and UX**, but not on **intelligent, secure observation**.

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## 🚀 What could happen

If we project forward, watch-only wallets could evolve into:

1. **Active visualization modules with user-defined rules**  
   ("If more than 0.5 BTC received → send alert via Tor")

2. **Shared infrastructure for multi-role teams**  
   - Legal views.  
   - Accounting audits.  
   - Signers execute.

3. **Integration with non-custodial AI agents**  
   Agents that analyze flows and suggest consolidations—without being able to sign.

4. **Compatibility with vault logic, Taproot scripts, and L2s (second layers)**  
   A *watch-only wallet* could interpret what’s happening in complex smart contracts—without being part of the execution.

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## 🔐 Final thoughts

*Watch-only wallets* are among the few Bitcoin components that, **if properly implemented, are not vulnerable to direct attacks**, because they **cannot sign transactions**.

And yet, they remain underused.

The future of self-custody isn’t just about secure signing—it’s about **observing with intelligence and sovereignty**.

Maybe we should stop calling them *watch-only*, and start thinking of them as **read-only intelligence layers**.

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## 🤔 Do you think *watch-only wallets* will remain passive tools, or will we see a new generation of wallets focused on active, intelligent, decentralized observation?

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## 📖 Visual Glossary – Key concepts to understand this post

| 🧩 Term               | 📝 Quick definition                                                              |
|----------------------|-----------------------------------------------------------------------------------|
| 👁️ *Watch-Only Wallet* | A wallet that allows you to **view balances and transactions** without spending. |
| 🔑 *xpub*             | Extended public key used to derive many addresses without exposing the seed.     |
| 🧾 *PSBT*             | Partially Signed Bitcoin Transaction—ideal for **offline workflows**.             |
| 🧠 *Multisig*         | Requires **multiple signatures** (e.g., 2 of 3) to spend funds.                   |
| ❄️ *Cold Storage*     | Offline storage for protecting private keys (e.g., hardware wallets).            |
| 🧬 *Descriptor*       | A standardized way to describe scripts and derivation paths in Bitcoin Core.     |
| 🌿 *Taproot*          | Bitcoin upgrade that enhances **privacy and efficiency** for complex scripts.     |
| ⚡ *Second Layer (L2)*| Protocols built on top of Bitcoin for **faster and scalable payments**.          |
| 🏰 *Vaults*           | Advanced setups adding **spending conditions or time locks** for higher security.|
| 🧷 *Fingerprint*      | Short identifier (4 bytes) of a master key—used in descriptors and multisig.     |

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> *This article is part of an ongoing series on self-custody, intelligent wallet infrastructure, and future-ready Bitcoin tools.*


Watch-Only Wallets: the functional present of observing without touching

🧠 **You don't delegate your own judgment: you build it.**  
Researching takes time, but listening to those who think without bias can shorten it — *if you know how to distinguish.*  
Thanks for sharing what you know.

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Today I was reviewing **Core version 29** and what is anticipated for **version 30**.  
Beyond cost and scalability, there are always those who want to eat the pie in stride.

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📊 **OP_RETURN discussions continue to divide.**  
Recently, Bitcoin Core developers proposed to **remove the 80-byte limit on OP_RETURN**, allowing:
- Outputs exceeding this size  
- Multiple OP_RETURN outputs per transaction

This proposal has generated significant debate in the community, with **mixed opinions on its impact** on the network’s efficiency and purpose.  
Sources: *Reddit · Crypto Tracker · Crypto News Australia*

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🤔 **Listening is useful.**  
But deciding... that's personal.




Deciding for yourself in times of technical noise

₿    Un Satoshi como punto de partida
🧠 Comunidad en construcción
♀️ Soberanía para mujeres
🌱 Desarrollando talento
⚡ Intercambio de valor, siempre bienvenido!