Lately we have on #blockchain market a lot of projects (and noise) around semi-custodial wallets, below a short tips&tricks what is important during #dyor
One liners to explain:
š”no Seed Phrases
š”no Private Keys
Remember about RT and ā¤ļø
First of all above magic sentences are implemented (and explained) by another magic words like:
š”Multisig
š”MPC
š”SSS
š”TSS
Lets find out what is important here to chose the best solution for our needs:
Multisig vs. (SSS vs. TSS)
Multisig stands for multi-signature, which is a specific type of digital signature that makes it possible for two or more users to sign documents as a group.
āBUT
ā ļømultisig occurs on-chain
ā ļømultisig is blockchain-specific
ā ļøneeds to be reimplemented for every #blockchain
MPC - multiparty computation is a cryptographic protocol that distributes a computation across multiple parties where no individual party can see the other partiesā data
āBUT
ā ļøComputational overhead
ā ļøHigh communication costs between players
SSS - Shamir Secret Sharing - provides a way to store the PK in a distributed manner such that while the private key is at rest, it is stored in multiple locations.
āBUT
ā ļø"the dealer" that is in charge of generating the PK secret shares
ā ļøthe parties must reconstruct the full PK in order to sign
TSS - Threshold Signature Scheme - is a cryptographic primitive for distributed key generation and signing
š”ļøBUT
ā
cryptography off-chain, while multisig occurs on-chain
ā
TSS relies on pure cryptography, so support is always possible
ā
TSS, no dealer, as its role is distributed such that the full PK is never at a single location.
ā
TSS, the signing is done in a distributed way without ever reconstructing the secret shares.
What is the conclusion?
Stay focused on projects that offer semi-custodial solution which implements TSS because:
šIn TSS, the private key (which represents the security of the system) is never at a single location throughout its entire lifetime.