Why have a multi-member wallet on Unido EP and how to set one up
In crypto, whoever holds the private key holds the assets, so if a hacker discovers your seed phrase and login details, your crypto holdings can disappear in a heartbeat, and this is one of the most common ways that wallets are compromised.
The truth is, keeping seed phrases and private keys safe is a huge responsibility, especially when you are holding this information on behalf of a business entity, trust or self-managed super fund (SMSF).
In today’s article we want to share how you can better secure your crypto assets using a multi-member wallet and show you how to set one up on Unido EP.
The private key
A crypto wallet is not a bank but a piece of software that records the crypto assets that have interacted with the wallet's address. The assets are not “deposited” or “saved” in the crypto wallet, merely the wallet is pointing to the blocks in the distributed ledger where those assets are recorded. The private key controls access to the crypto wallet much like a combination controls access to a safe.
The private key is a long number that is represented in hexadecimal values that are used to sign transactions. In blockchain, the private key is most often 256-bit in length, and it authorizes any transaction a user wants to conduct.
Normally, each crypto wallet has one private key. In most cases, only one person is in control of the assets and can sign transactions personally. Yet, since the beginning of Bitcoin there has been a system that requires multi-authorization to sign a transaction, the multi-signature wallet (multi-sig for short).
In a multi-sig wallet, several owners control a private key and they need to agree on each transaction. Sometimes it can be a simple majority, a super-majority, or even a unanimous agreement. Regardless of the individual configuration, a multi-sig wallet requires more than one signature to process a transaction.
Multi-sig wallets have become popular in crypto hedge funds, family offices, or any type of entity that controls crypto assets as a group. Multi-sign wallets increase security, allow for greater asset management and give members more transparency.
That’s why Unido’s technology is built upon a multi-sig MPC foundation. Our Unido Core technology enables private keys to be distributed at the blockchain level, adding robust security for organizations that require a high level of governance and accountability.
How to set up a multi-sig wallet on Unido EP
First, create a wallet on the Unido app.
Next, add extra members to your account. Members will be notified of any pending transactions and have the right to vote on important transactions such as adding or removing new members, movement of funds, changing the number of required signatures or deleting the account.
If you do not have other founders in your organization to invite in, you can also authorize other devices or even family members to co-sign on wallet transactions.
Once you have set up extra members in your account then you may choose how many signatures will be required for the wallet. You can choose between one signature right up to the total number of members that you have in the wallet.
For example, you could start with a "1 of 1" wallet and then add an extra 5 members so that wallet has a total of 6 members (including yourself). You could then add an extra 3 required signatures to make a total of 4 required signatures.
For example, a "1 of 4" wallet scenario means that:
- any member of the wallet may set up a transaction
- all 4 members of the wallet will be notified that the transaction has been set up
- at least 1 of the 4 members must sign the transaction for it to be successful
Further changes to the members or signing structure can be made at any time.
Note: The 'signatures' option will only appear in wallets with more than 1 member.
A Unido EP wallet is an easy way to customize the custody of crypto assets using a simple interface.
The wallet can be configured in a number of ways that can dictate the amount of votes any type of action requires, and also serve as the main hub to control the crypto assets of any SME.
Learn more about how Unido EP can secure your business crypto assets here.
About Unido EP
Unido EP is an out of the box complete crypto custody solution. Our platform allows individuals and businesses of all sizes the ability to easily customize controls over their crypto assets. By using our interface, anyone can create a crypto wallet, share control to several users, and set a minimum set of approvals for each transaction.
Unido EP comes with a web-based dashboard and a decentralized application (dApp). Our platform is poised to create a new standard on crypto asset security delivered to the hands of every type of crypto user. Join us now in our journey to transform crypto asset management.