Nostr Web Client

Ok, so this has been my main concern for some time. I felt crazy for not going along with the hype of otherwise stellar BTC-focused companies offering 3rd party key holder services. Now not so much.

Elaborate, please.

Kevin 1y ago

So for KYC this is absolutely correct. They cannot spend your #btc because they won't have two keys, however, they WILL know who you are, and have complete access to all your receive/change addresses.

If their security ever fails, your entire stack will be broadcast for the world to see. EVEN IF you buy non-KYC #Bitcoin if you send it to one of those multi-sig addresses, the xPub will reveal that you own it.

The only way to get anonymity again will be to either coin join to a new multi-sig setup, or you might be able to do it pegging into liquid then out of liquid. Still working through that one.

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Discussion

Tanner Krōgman 1y ago

So, at least theoretically, the most secure setup would be a two of three (or equivalent ratio) multi-sig, geographically distributed in accessible and secure, but undisclosed locations, etc., etc.

Is there a selling point to institutional key holders that I'm not seeing? (outside of a holdover fiat mindset/need to have someone hold your hand)

Kevin 1y ago

Yes. The whole multiple companies in different jurisdictions, ie countries, so you're not subject to one country's laws and inheritance. You die tomorrow, your heirs can retrieve the #bitcoin. Just have to prove with death certificate and the companies will release the keys to your beneficiary.