Cryptocurrency news

The Bitcoin developer has proposed a prototype of an in-network BTC storage

The Bitcoin developer has proposed a prototype of an in-network BTC storage

Brian Bishop proposed a prototype of an in-network BTC storage. According to the developer, this product will help protect bitcoins from theft and ill-considered spending.

The idea of secure storage of BTC by means of the blockchain was expressed back in 2016, but for the implementation of the initial proposal
a hard fork was required, which the Bitcoin developers did not implement. Now the idea has been continued-Bitcoin developer Bryan Bishop (Bryan Bishop) I offered a prototype of a storage that doesn’t require a hard fork on GitHub, and shared my idea with the Bitcoin Core mailing list participants.

“People don’t know how to protect their keys,” Bishop said. “We can help them by creating software that will allow them to store bitcoins better and more securely.”

The main idea is to store BTC in the network in a secure way that allows you to stop the transaction in case of security problems. The approach to storing private keys on the network distinguishes Bishop’s proposed storage from the concept of a cold wallet.

Cornell University Professor and blockchain expert Emin Gun Sirer was part of the team that proposed creating such a BTC storage back in 2016. He said he was following Bishop’s work closely.

“It’s great to see storage moving from concept to reality,” he said. “We would like storage to become a standard feature for all cryptocurrencies.”

How it works

In the case of storing crypto assets in a normal cryptocurrency wallet, their safety is guaranteed only by the security system of the wallet itself. If someone gets access to the private keys, the user can’t stop the transaction.

The vaults proposed by Bishop and other developers offer an alternative option in which, in case of security problems, the user can stop the transfer of a crypto asset. Stored bitcoins will be divided into” shards”, as Bishop calls them. These shards will help you release bitcoins to a hot wallet in parts – one shard at a time.

The proposal includes the concept of “watchtowers” (watchtowers) – control channels for detecting fraudulent transactions that will help monitor storage. Each time these channels record the movement of the BTC shard, they will notify the owner of the crypto asset.

If the attempt to transfer bitcoins was not authorized, the user will be able to activate a pre-signed transaction that will move all his BTC to a cold wallet before they are unblocked by the attacker. Under certain conditions, ” watchtower» it can skip the notification step and simply initiate the transfer of BTC to a cold wallet.

“To manage this storage and everything associated with it, you need at least the appropriate software. This is not a manual procedure, ” Bishop said.

It is not yet clear whether each user will need to run their own “watchtowers”, or whether one channel will be used by several people. According to the developers, such repositories will help users protect themselves not only from hackers, but also from themselves, and avoid mindless spending.

This model of releasing BTC at certain time intervals can be useful, for example, for cryptocurrency holders who periodically “pay themselves” a certain amount, and want to get rid of the temptation to withdraw a large number of coins.

“I want to make it clear that this is an experimental model and so far only a prototype,” Bishop said.

The Bishop implementation was created with the assumption that BIP 119 would one day be adopted. It is still viable, but according to Bishop, if BIP 119 is adopted, “it will make some security measures tougher.”

Related projects

Bishop is not the only one working on the concept of such repositories. Chainsmiths is developing a Revault product, which it plans to start raising funds for. The author of the product was the CEO of the company Kevin Loaec (Kevin Loaec).

He said Revault is designed for “people and companies who need to move assets frequently and quickly. The product demonstrates a completely new level of security compared to the one currently offered by multi-signatures.”

Bob McElrath, who previously worked at Fidelity, is currently working on a similar implementation with several co-authors, information about which will be published soon. The description of the product is very similar to the idea proposed by the Bishop.

“This is a very complex type of wallet,” Mcelrath writes. “It includes at least three types of wallets: “active” wallet (used for sending and receiving), ” storage “(synchronized storage), and” recovery ” wallet (new storage in case of attack).”

Ittay Eyal, who was also part of the team that created the original Bishop storage proposal, is working on a similar idea, but for a different blockchain. He said:

“Our team is currently developing a reliable and secure storage implementation for Ethereum in collaboration with Certora.”