The MPC method

Nowadays the modernization of digital payments through blockchains and cryptocurrencies has proven to be prosperous and hence - in need of better quality security and more enhanced authorization methods. Lately, the MPC model has surpassed Multi-Sig and has become the standard for institutions and businesses who manage cryptocurrencies, transactions and Digital Wallets. MPC stands for “Multi-Party Computation” and includes TSS - Threshold Signature Scheme, which holds multiple approvers and one single key distributed among them for authorization purposes. Transactions are signed, approved and broadcasted with a single signature and the signers’ key shares never become public information, or even leave their holder’s domain.

Features

Blockchain address specifications

To make successful transactions, users need to have addresses that can work with the implemented blockchains and are compatible with possible future services. Currently, Multi-Sig already fails to support specific services (e.g. DeFi) and not all Wallets support transfers from Multi-Sig smart contract addresses. Unlike Multi-Sig, MPC-based Wallets provide their customers with a simple address which can be used in any decentralized application and service continuously and without an issue.

Flexibility and compatibility

Multi-Sig has an issue with supporting various blockchains and cryptocurrencies, as each of their implementations is different. Moreover, changes in the code of a blockchain, when there is e.g. a hard fork, can lead to issues for Multi-Sig when referring to HSMs (hardware security modules). MPC doesn’t face these difficulties and can be deployed on all device types - mobile, desktop and server.

Scalability

Unlike Multi-Sig solutions, which possess pre-set features, MPC-based solutions can scale a lot quicker and easier due to their blockchain agnostic nature and adaptability to sudden changes, such as - blockchain forks, larger client pool, technology advances, etc. MPC can adjust and scale risk-free to the process of accessing and transferring digital assets after certain growth changes have been implemented. These could be associated with hardware modifications, software updates, increased number of employees, creating new and revoking old key shares, etc.

Eliminates Private keys

Both authorization methods MPC and Multi-Sig apply an access key system where each user would have their own key. The difference is that Multi-Sig uses “private keys” which are infamous for their single point of failure. Moreover, after a transaction is complete, all signatures of all signing members are recorded as part of the transaction record, which is proven to be unreliable and unsafe. In contrast, the MPC method uses TSS (Threshold Signature Scheme) where one key is distributed among all signing members as “key shares”, hence one signature is derived after the transaction is broadcasted. This method has a higher level of security much more preferred to Multi-Sig.

Joint computations

Through MPC all parties involved can perform joint computations. This allows them to securely analyse and process sensitive information, much like a shared database.

No data sharing

The nodes (parties involved) do not share any information between them when data is being processed. The MPC model in general prevents any information leaks and data hijacking.

Protocol-agnostic

MPC solutions are protocol-agnostic. Unlike Multi-Sig systems where there are limitations depending on the particular blockchain, MPC is not affected by such specificities and allows for an easy onboarding and seamless integration with new blockchains and cryptocurrencies.

MPC - The New Standard

The MPC model is lately being adopted by more and more companies which develop Digital Wallets. It provides a better algorithm, security and privacy for signing transactions and managing WaaS. Moreover, TSS allows for the lowest transaction fees possible and provides for hidden signatures and off-chain accountability. Our MPC is provided and optimized by Sepior, so that we can produce a secure and efficient way for customers to manage and transfer their cryptocurrency funds in any way desired. MPC is now the new standard and Crypto APIs 2.0 is using it.

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