Understaning Multisig Wallet - Part 2
Hello everyone, hope you all are doing good? I'm back with the Part 2 of this amazing series, Understaning Multisig Wallet. If you haven't read the Part 1, I strongly suggest you that by clicking here. In today's article we would be looking at how to download, install & set up a 2-of-3 BTC Multisig wallet(Electrum), the differences between Seed key and MPK and it is right to share the seed key or MPK with your co-signer and why?
If you follow my steps, you should be able to download, install and set up a 2 of 3 BTC wallet combination on Electrum.
- Click on this link to land on Electrum download page.
- When you arrive on the page, click on the suitable installer for your device. For me, I'm using Windows, so I clicked on Windows Installer. After clicking, it started to download immediately.
- After it was successfully download, open the file and click on "Install".
- After it finished installing, you can start creating your Electrum wallet.
- Ensure you choose a "Multi-signature wallet" and then click on "Next". I will be using a 2 of 3 wallet combination, so my consigners should be set to 3 while my signatures be set to 2.
- Next, click on "Create a new seed" and the click on "Next".
- Your wallet seed will be displayed. Ensure you stored it somewhere very secured because if it gets stolen or lost, you won't be able to recover your wallet again, so store it somewhere very safe. You will then be asked to confirm your wallet seed, to ensure that you have successfully stored it somewhere safe. Retype your seed and click on "Next".
- Your "Master Public Key (MPK)" will be displayed, ensure you copy it. After that, this is when you have to create the other two wallets. Do same process, and ensure you copy your MPK because that is what you will be sending to all wallets, for each wallet to be able to have the capacity to sign transactions.
- After you have successfully created and sent the other two wallets' MPK, you will then be able to create a password for your wallet.
- Boom!!! Congrats!!! Your wallet is activate and ready.
- I had to verify if all the 3 wallets have the same receiving address, in order to know if they have successfully bonded with each other. To, do that, you need to open your three wallets and click on "Receive" and then click on "New Address" on all 3 wallets, in order to verify if you will get similar receiving address.
- Boom!!! All 3 wallets are bonded, as they all have the same receiving address. The wallet is now officially a 2 of 3 wallet combination.
Difference Between Seed Key and Master Public Key
Seed Key is the wallet highest security, if all keys fails, we resort to the Seed key, so it is the all powerful key. For it instance, on steemit we have 3 main keys, Posting Key, Active Key and Master Key. The Master Key is the ultimate key to your wallet. Your Posting Key, as well as your Active Key can be compromised, and you won't be so afraid, because you can change your keys and have new Private and Active Keys through your Master Key. But if your Master Key is compromised, your wallet is gone for good. Seed key is like Master Key in steemit.
Whereas Master Public Key (MPK) is simply used to add consigners to your Multi-signature wallets. Master Public Key is derived from Seed Key.
Would You Share The Seed Key Or MPK With Your Co-signer And Why?
I would share my MPK with my cosigners in other to bond our wallets, so we can perform multi-signature transactions. But I won't share my Seed key, as it is my personal wallet safety key and should be kept safely and without anyone knowing or seeing it. And also, it was obviously stated when your Seed key was displayed during the process of creating your wallet, that you should never disclose your seed.
I hope you all found the article interesting and exciting. Do well to share your thoughts about the article in the comment section below. Thanks.
Hi @menoski
I had a rough idea about this multisig wallet but after going through the post that you published here has made me understood more about this form of Crypto technology and how we can make multiple transactions in one go.
I always believe that there is a lot to explore and make things better provided we spent time and learn about it. Thank you so much for sharing this great Post with us that has helped in knowledge enhancement.
Hello friend, excellent information, certainly these new digital wallets have greatly improved the fact of being able to save and change our money in a safer way. Thanks for sharing it. Regards!
Hi friend @menoski
You have shared very detailed and clear information about multisig wallet so anyone can easily understand this becasue you have also provided detailed screenshots which is nice work. Anyway seed key is very important for any wallet so i always prefer to save it in multiple devices such as pendrive, computer as well as i store in my laptop too. You have to save it securely that's it. Solid read