Decentralize Crypto Keys? One Non-Profit Company is Proposing Exactly That
There are plenty of interesting blockchain ideas out there. Each one proposing to disrupt some small or substantial part of the industry they've set their sights on. But a brand new proposal is actually thinking of taking the whole process of decentralization even further.
How? By decentralizing the very private keys that these solutions commonly use.
A Matter of Trust – How a Trustless Bot Could Handle You Crypto Keys
Far from being some kind of fringe company, Tide is one of the more better-known non-profits advocating for greater personal privacy for users online. According to the team, it has developed a brand new kind of decentralized technology – this allows for the provision of a completely trustless bot to be made responsible for the provision of codes for users.
Otherwise referred to as a Delegated Automated Trustee (DAT), this solution effectively aggregates and decentralizes the whole process of obtaining private keys.
According to a further announcement from early-August, this Delegated Automated Trustee can operate as the custodial solution of a crypto-key, this allows for users to manage access to personal data, or even enable a wider array of automated trading bots that can access funds without the use if a full key.
So what does this process entail for those using it? The key protecting the data or various range of crypto assets are divided a number of pieces, which are then split between a collection of nodes. These keys are split across nodes in order to ensure that no single node has full access or knowledge of the whole key. And even if one of these nodes did, they wouldn't have the authority to unilaterally use it.
It's because of this system that DAT represents, not only an autonomous solution, but also prevents malicious access to your key pretty much impossible.
One of the additional features of this is that these various nodes can actually perform functions through the use of the key. The user can then choose to specify the parameters that would otherwise dictate the authority provided.
So What on Earth is DAT?
This same trustless bot solution can actually manage access to a users personal data, perform decentralized authentication solutions, along with password and key recovery solutions. These also include a range of business processes that would otherwise require longer-term access to crypto-assets, can actually be granted to these bots, so long as it falls within specific criteria.
Michael Loewy, the co-founder of Tide, provided a couple of examples of what exactly these kinds of criteria could consist of:
“In the context of the Tide ecosystem those instructions may be a set of rules determining which data fields I’m prepared to trade with certain types of organizations — for example, I don’t want any contact details traded with political organizations. That same concept can also be applied to advanced crypto trading — for example, social trading where my instructions may be to follow or mirror the trades or a peer or expert trader.”
Privacy as a Business Solution
Some of the centralized solutions out there within the centralized world have actually sought to provide a range of solutions that could address some of the issues. The problem is that these same solutions have serious vulnerabilities due to these same centralized architectures.
This architectural flaw limits automated trading bots that are developed by these centralized entities, while providing a more secure solution. However, with the use of a trustless DAT solution, these trading bots can actually operate in a decentralized way on similar kinds of exchanges without giving up any kind of sensitive information.
One of the underlying advantages that comes with the use of a decentralized exchange is that users of them have complete and total control over their funds and private keys. The use of a centralized bot, for example, introduces into this decentralized system a centralized point of attack; putting all of your data at risk. Considering the fact that Bots using DAT are trustless, this risk is significantly lower.
As an investor, holder or enthusiast in the cryptocurrency world, ensuring a continued level of secrecy when it comes to your private keys is critical. Anyone that could get hold of them would effectively get access to your crypto assets. This is one of the underlying issues that face parties seeking to operate as custodians in the cryptocurrency space. With DATs being one of the very real solutions that could keep this information in the hands of the end user.