” Why are you working on another multi cryptocurrency wallet?”
Nice question, isn’t it?
We decided to start a short cycle of articles dedicated to our Killer features, it will be an elegant answer to the question above.
The main shortcoming of most existing cryptocurrency wallets is the following: all addresses within them are generated randomly, each address has a corresponding key (several keys sometimes). In order to guarantee that an operation is completed you need to back it up. What is more, you have to store somehow and somewhere not only the key file, but also complex passwords to it. Well, quite a problem.
Bitcoin Improvements Proposals 32, 39, 44 have been created to guarantee anonimity and security of cryptotransactions. These BIPs compose a technology known as “Hierarchical Deterministic Wallet”. Multy’s development will be based on this technology.
BIP 32 describes an idea of deterministic wallets: a system doesn’t suppose any unespected and undetermined things to happen within it. BIP 39 generates a so called seed-phrase – several randomly organised words which are a single key to all your adresses at one time. BIP 44 determines the hierarchy of the adresses and their interconnections in a tree-form.
The main purpose of the technology is as follows: if you know a seed-phrase you can get acceess to all of the wallets. It means that you don’t have to try to remember those 100500 keys. And it concearns all altcoins, not only Bitcion.
Advantages of the technology
- high level of anonymity: uniting seed-phrase/Master Key with hash-functions means creating interconnected addresses, their connections are known and shown only to you;
- if you lose control over your HD wallet you still can regain access to all of your addresses using your one seed-phrase;
- it’s much easier to remember one phrase instead of numerous keys to each address;
- all your addresses are backed up all together – it keeps your assets safe and unchanged;
- single seed-phrase may be used for several cryptocurrencies.