New York-based crypto custody startup Casa has released a new security protocol and service focused on helping people address the question of Bitcoin (BTC) inheritance.
The new offering, dubbed “Casa Covenant,” was revealed in an official blog post on Oct. 21.
“What happens to my Bitcoin when I die?”
Casa approaches the question of Bitcoin inheritance by highlighting three common positions users take currently: either not thinking about the issue at all, choosing to entrust their private key data with a close family member or friend, or using a third-party custodian to manage the process.
All three carry evident risks — the latter two in terms of security, theft and trust, while the former leaves open the possibility that the Bitcoin will become forever irretrievable.
Casa argues that even social recovery schemes are vulnerable to small errors that could place people’s inheritance at risk.
Its new solution thus aims to offer both a technical and service-based approach to inheritance, in compliance with the existing estate planning and legal system in the United States.
“The best path is for an estate attorney to protect a single client key in your multisig setup in the form of a hardware wallet, along with all the other documents needed for proper inheritance.”
On the technical front, a specialized protocol has been designed with multi-sig technology, which includes the addition of an optional 6th key to Casa’s existing “3-of-5 Key Shield” setup.
In addition, the firm is launching a service that includes access to a specialized estate lawyer, set-up assistance and ongoing support and education for holders and inheritors about the security and custody options available to them.
Casa notes the somewhat thorny nature of inheritance for a community that prizes disintermediation and autonomy so highly:
“While we don’t like trusted third parties in Bitcoin, we must trust third parties (even our family members are third parties) if we aren’t around to execute our requests.”
Nonetheless, it is only by carefully defining a technical, legal and security process that includes yet minimizes some degree of trust can the issue begin to be solved, the firm argues.
As previously reported, a high-profile alleged death was at the heart of the controversy surrounding the now-defunct Canadian cryptocurrency exchange QuadrigaCX, which involved the loss of $190 million in cryptocurrency.
Big Four auditor — appointed to monitor the proceedings in a QuadrigaCX creditor protection case — then went on to lose 103 Bitcoin inadvertently.