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121 sats \ 7 replies \ @mallardshead 19 Aug 2023 \ on: Multisig is easy and you should use it bitcoin
I'd never use multi-sig unless it was business-related or hybrid self-custody (3rd party key and xpub retention). In fact, as an individual, I'd probably never use more than a 128bit 12-word seed with a passphrase, because in addition to the hardware backups, I want it backed up to my brain (memory) as well.
Why wouldn't you use multisig? I've been thinking of going multisig, but the only con I'm aware of us the technical complexity.
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As a multi-sig user myself, the two main pitfalls IMO are:
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Additional backup complexity. In order to recover the wallet from scratch having 2 of 3 seeds is not enough; you'll need all 3 public keys in the quorum.
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Privacy. Due to the importance of backing up the public key set, you'll need multiple copies of this stashed away (ideally one copy alongside each seed backup). While an attacker cannot use the public key set to spend funds, they CAN see your balance. The same is true with collaborative custody models.
Basically it all comes down to the xPubs being a pain in the ass. It would be amazing if that went away and you only needed N-of-M keys to recover the wallet. Perhaps someone will figure that out one day.
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Does a 12 word seed not worry you at all with the issues that came out the other day around seed words been guessed/cracked? Can’t remember the name but it was in Antonopoulos’s Mastering Bitcoin.
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No. A seed with sufficient entropy of 128- to 256-bits can't be guessed unless an attacker guesses 1 trillion times a second and they have longer than the age of the galaxy on their hands. And this assumes they know the derivation path and passphrase to begin with. With a passphrase, it wouldn't matter if they guessed your seed right, it would show an empty address, they'd never know one address from another. Trust the math. Trust the computer science. The complexity of self-custody with many of the latest schemes: Shamir Secrets, XOR, substitution cyphers, multisig, etc, is really unnecessary complexity. You fall off the other side and become your own worst enemy, more so than a potential attacker.
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So why the need at all for 24 word seeds and multi-sig for sole custody?
I trust the math and use a single-sig setup myself but I still got a bit worried reading that last week and started looking into Nunchuk.
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If you are using bad seed generation, then having multiple keys might still fail. Not to dismiss your case at all, but a factor to bear in mind.
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