Multi-signature wallets like Gnosis Safe are a secure way to store funds without relying on a centralized entity. They offer self-custody benefits, meaning your funds are not at risk if a seemingly trustworthy person fails. Social recovery wallets are similar, allowing funds to be recovered using keys held by others in case the master key is lost. Both types of wallets rely on “custodians”, which are individuals or entities that own keys who can approve transactions or return funds.
Self-reliance is important. And social rehab and multi-signature is a great way to do that.
A short post on Reddit about how I think about choosing guardians for social recovery and multisig wallets:https://t.co/FY1iyJ6BFC
— vitalik.eth (@VitalikButerin) March 17, 2023
Vitalik Buterin, co-founder of Ethereum, recently shared his thoughts on using multisig wallets and social recovery. He personally uses a multisig wallet to store most of his funds, as does the Ethereum Foundation. He believes social recovery wallets, when mature, will be ideal for “hot wallets” that store small amounts of funds for daily use, while multisig wallets are best suited for “cold wallets” that store long-term saving.
Guardians play a crucial role in both types of wallets. For security guardians should be selected based on their ability to keep their keys secure and on their reliability. Ideally, the guardians should not know each other to minimize the risk of collusion. In addition, they should be geographically dispersed and use different types of wallets and operating systems to minimize overall risk.
When requesting a trustee’s approval for a transaction or key reset, they must ask a security question to verify your identity. This prevents hackers from impersonating you to gain access to your funds. If you need a quick response from caregivers, it’s important to choose those who can act quickly and are located in different time zones.
Regular testing of guardians ensures that they have not lost or forgotten their accounts. It is recommended to have two test surgeries per year with half guardians each time.
Credit : u.today
