I saw this post (#1232780) and it made me curious. All these pseudo-vault kind of things feel a little useless to me. Let's see if this one is different:
This BIP introduces an interoperable mechanism that allows users to operate a self-sovereign "kill switch", that locks wallets when activated. Cooperating wallets prohibit the spending of UTXOs when activated.
How does it work?
- You have a private key that controls your main stash (call this the stash key)
- You create a second wallet (call this the guardian key)
- this key is not related to your stash key
- this key only generates one address
- you load the guardian key's pubkey into your wallet software so your wallet knows to look for op_return lock and unlock signals from it.
- you broadcast a transaction from your guardian key with an op_return that includes a message signaling unlock
- there is a format for this in the BIP, but it really could just be as simple as the word " unlock"
- there us no need to include any data connecting this message to you stash key
- you create a presigned transaction with your guardian key that has an op_return with the message "lock"
- you should not keep guardian key material easily accessible or near your stash key material
- the presigned lock tx can be safely kept accessible
- when under duress, broadcast the presigned lock tx from your guardian key
- when your stash wallet sees such a tx, it should not allow signing of any tx from the stash key
The problem: "Non-cooperative wallets will ignore the signalling mechanism"
The BIP says:
This BIP does not attempt to cryptographically restrict spending conditions at the consensus layer.
Well...that's a problem. Basically this protocol only works if all other wallet software follows it, and even then it only acts like a policy. Miners can still mine "locked" transactions, and nodes will see them as valid.
If someone has your stash key, they have your bitcoin. All the fluff in this BIP just possibly makes it a little more inconvenient to sign a transaction.
A second BIP describes a guardian address monitoring protocol, but again it only applies to cooperating wallet software. Thieves will just learn to use wallets that don't cooperate. Seems trivial to circumvent.
Cooperating wallets prohibit the spending of UTXOs when activated.
So, in addition to adding an extra key to keep track of, you only get security from it in the specific instanceo that thieves use software that follows this BIP when trying to steal from you...
Unless I am really misunderstanding this, this BIP is a horrible idea.