Wednesday, November 23, 2022

Idea for backing up keys safely

Quick bit of background, Im a college student who's been in crypto seriously for about a year, so don't sledge me too hard :)

Hi I've noticed that a lot of people on this sub are hesitant to get into Bitcoin in the fear that they'll lose their ledger, chuck paper into the bin etc.

The fundamental difference between this and the fiat system is custody over keys and one of the big barriers IMO is people being afraid to store their own keys. So I've come up with an "insurance" protocol for your keys.

Essentially, I want to know what people think about an open source protocol idea I have. Simply speaking its a way to back up your keys by encrypting them with information only know would know and then storing this on the blockchain.

A basic illustration could be, I could take my keys encrypt them with my bank details, passport number mothers maiden name etc. and store that (on chain). I would also have some record of what I have used for the encryption i.e.e mothers name bla bla bla.

Obviously the stuff you encrypt it with has to be stuff you won't forget in 50 years and that only you should know (I have a list of such things)

The motivation for this to have a copy of keys accessible should you lose a hardware wallet, change pc, metamask goes down etc or any black swan events like this - but it could be a good backup.

In theory, if this all comes together, there will a copy of your keys sitting immutably on some blockchain so you will never really lose your crypto if you lose your hardware wallet etc... in my head this would reduce some of the stress associated with holding your keys because you won't be worried you will lose them if you can always recover them. You can also store them more securely-i.e. you won't feel the need to put them in a notes app (which is important if you lose your HWW), because you can always get to your Bitcoin through this means.


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