There are multiple ways to self-custody bitcoin, but it is generally recommended to use ‘cold storage’ for a higher level of security. This method involves storing your bitcoin keys offline, away from any internet access, using a hardware wallet—also known as a ‘signing device.’
Singlesig Cold Storage
In a singlesig vault, the security of your bitcoin relies solely on one private key generated and stored by a hardware wallet. These singlesig vaults are ideal for consolidating bitcoin prior to multisig cold storage (for improved UTXO management) and simplified on-chain transactions.
With singlesig comes the inherent risk of having a single point of failure. This risk is mitigated in a multisig wallet, where multiple keys are required to authorize a transaction, offering greater security.
Hardware devices paired for multisig can also be used to create singlesig vaults.
Multisig Cold Storage
A cold storage multisig vault is one secured by hardware devices, where the majority of keys are secured offline. It's cold storage without a single point of failure.
Theya offers modular multisig vaults, meaning users can hold the majority of keys using hardware devices while Theya retains one key in an offline HSM (Hardware Security Module) as a backup for recovery purposes.
By possessing the necessary keys for making a transaction, users maintain direct control over their bitcoin. And when set up with hardware devices, no keys are stored in an internet-connected device.
Theya is the easiest solution for cold storage with a collaborative multisig vault.
If You Add A Mobile Key
In order to be considered ‘cold storage’, the majority of your keys need to be secured offline. Because the Theya Recovery Key is always held offline in an HSM:
If your first and second key are hardware devices, your keys are fully offline.
If one of your keys is a mobile key, and the other is a hardware device, the majority of your keys are still offline.
Theya's Recovery Key is held in an offline HSM (Hardware Security Module).
If you and your cosigner are both using mobile keys, the security benefits of ‘cold storage’ have been lost, as the majority of keys are now held on internet-connected devices. Introduce one or two hardware devices to enhance security (highly advised for meaningful bitcoin holdings and greater peace of mind).
Creating Cold Storage Vaults With Theya
Whether you are creating a singlesig or multisig vault with hardware devices, the general process is the same.
Download Theya and create an account.
Pick hardware device(s) that are compatible with Theya.
If you are looking for a comparison breakdown of devices, read our blog post: Best Bitcoin Hardware Wallets.
For new devices, follow manufacture instructions to generate your private key and seed phrase backup.
You can pair existing devices.
Follow instructions for pairing your specific hardware device(s)
Note: With all singlesig or multisig wallet setups, it's at the user(s) discretion how to secure and store their physical hardware devices and recovery seed phrases.
Video Tutorial
Watch @JoeConsorti set up a 2-of-3 multisig vault with a Coldcard MK4 and a Trezor Safe 3. Subscribe to Theya for market updates and more tutorials.
Schedule a free consultation to discuss your specific needs!
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