Domain: Finance – trading and custodial services
Problem identification: Funds’ security against key loss
Why Blockchain:
The main benefit of the project is the fact that users are insured against the loss of their private keys. In addition, the multi-signature system ensures that each transaction must also be approved by a guarantor. For this reason, you are also insured against theft because the thief must know two private keys instead of just one.
The key problems that the project addresses are:
- Insurance against the loss of keys
- Theft insurance
Functional Description
Conio provides a special Bitcoin wallet. It is designed to manage users’ private keys in such a way as to eliminate the risk of loss or theft of their funds. The wallet builds 2-of-3 escrow services and allows you to make bitcoin transactions signed not only by the user but also by a trustee belonging to the company. This trustee is always different for each transaction, in order to minimize trust issues.
The company manages the electronic wallet relieving the user from the responsibility of managing private keys. Everything is done through a smartphone application. To send a transaction, the user enters his PIN and then authorizes the transaction. The company automatically completes it with their signature. In this way there is a double signature for each normal transaction.
In case of loss of the PIN by the user, Conio is able to transfer the funds using their second key and send them to a new user address. This way your funds are not lost. The key required for the third signature is isolated in a non-networked archive that is inaccessible via the internet. To access it, the company requires the user’s authorization.
The system consists of two components:
- Bitcoin Client: the company has to track the Bitcoin blockchain to operate; it also contains the digital multi-signature wallet of the users
- User Client: A smartphone app which manages the user’s private keys; these keys are not exposed to the company
Technology used
- Blockchain: Bitcoin
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- Software: BitcoinCore (probably, not disclosed)
- Main characteristics of the chosen blockchain
- Public
- Permissionless
- Consensus mechanism: Proof-of-Work
- Smart Contracts
- Available Programming Languages: Bitcoin Script
- Chosen Programming Language: Bitcoin Script
Current status
The project’s code repository is proprietary. The current Conio Wallet App version is version 3.2.2 for both Android and iOS. The Conio Wallet App v3.2.2 was released Jan 02, 2020.
The project is a commercial application, currently working and regularly updated.
There is no code available online.
Focus point commentary indicating the value of the case study in relation with learning modules
Learning Modules Focus Points Peer-to-Peer database design Encryption techniques key recovery via escrow services Consensus Proof-of-work Digital Signatures Multi-signatures, escrow-services Smart Contracts Privacy and Property Rights Custodial services and privacy related matters Blockchain-based Decentralized Applications Decentralized Autonomous Organizations DAOs [Here you can write the focus points of the project regarding the specific learning module.] Limitations:
- Security: giving a third-party partial control of funds is diminishes security (e.g. the party refusal to sign transactions)
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- Privacy: giving a third-party partial control of funds is diminishes privacy (e.g. the party knows how and when a user spend his funds)
Alternatives Approaches:
- BitGo: https://www.bitgo.com/
- The key recovery service dispenses xpubs (Bitcoin public keys) to anyone who requests one for use as a cold key in multisig wallets. https://github.com/BitGo/key-recovery-service
References