A new startup, Third Key Solutions, has been launched to help address the problem of the centralization of Bitcoin security.
Although Bitcoin is designed to decentralize money, oftentimes users have to entrust security to others, such as when trading on an exchange or working with hosted wallets. In such cases, the safety of their holdings is only as good as the trustworthiness and reliability of the third party.
Third Key Solutions was co-founded by Andreas Antonopoulos, a prominent expert in Bitccoin security, as well as Pamela Morgan, an attorney and entrepreneur who took up a recent interest in digital currency.
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The company specifically does not offer to act as trusted custodian over your bitcoins. Instead, the startup acts as a security consultancy, advising businesses on how to, for example, manage private keys. Because most companies don’t have the time nor expertise to deploy top notch security schemes on their own–naturally leading them to seek out third parties–Third Key advises on how they can do it themselves on their terms.
Where Third Key can play an active role is through its custodianship of a third key in two-of-three-key multisignature deployments. Without a second key, it is powerless to gain control of the bitcoins, which are still recoverable with the other two keys even if Third Key’s is theoretically lost. Andreas sums up the concept as follows:
“Bitcoin’s multi-signature feature is an incredibly powerful technology for digital currency security. However, technology is not enough. Security depends on technology, process, and people.”
The company employs the latest technologies in Bitcoin security, including hierarchical deterministic (HD) wallets and mnemonic phrases.