- The crypto-custody company Casa has announced a new service to facilitate the inheritance of Bitcoin (BTC).
- The private keys are managed using multi-signature technology.
The New York-based crypto custody company Casa released a new service for its customers yesterday to facilitate Bitcoin (BTC) inheritance. In the blog post, the company explains that “inheritance is one of Bitcoin’s biggest unresolved issues”. According to Casa, there are currently three common solutions, all of them unsatisfactory.
As Casa describes, Bitcoins cannot be passed on in the event of death and in the worst case they are trapped forever inaccessibly in a Bitcoin wallet. Otherwise, it is common for a family member to receive a note with instructions and PIN codes. The third option is a custodian bank that manages the private keys. However, these usually do not have an inheritance process.
Casa argues that even the solution via family members is prone to errors that could endanger the inheritance. There is a risk that third parties might accidentally obtain this information and misuse it for their own benefit. Furthermore, in practice there is often the problem that Bitcoin owners have not made any arrangements for death, as Casa states in the current blog post:
Because of this, most people don’t have a solution for Bitcoin inheritance. It’s on their ‘I’ll think about this later and hope I don’t get hit by a bus in the meantime’ checklist. This has to change.
“Casa Covenant” regulates BTC inheritance
As a result, Casa has released a new security protocol and service to help people resolve the issue. Casa Covenant combines multi-signature authorization with a security protocol to allocate Bitcoin assets for future inheritance. It allows users to securely pass on their Bitcoins to specific heirs after death. At the same time, the risk of the BTC being stolen in the time before death is minimized.
Technically, a multi-sig technology has been developed that extends Casa’s “3 out of 5” key technology with an optional sixth multi-sig key. To initiate a transaction, three of the six key holders must agree. In a scenario where the customer dies, a lawyer key, casa recovery key and safe key can be used to recover funds.
Casa offers its customers assistance in establishing the setup. The company also works with law firms to educate them about the management of private keys. Casa also provides tools to support this process:
Casa will be there to help throughout the process—from initial setup and technical consultations to the actual execution of transfers. We’ll educate your estate lawyer on key management, provide lawyer-specific tools for managing keys, and assist your heirs in using Keymaster to properly recover funds.
Although Casa offers its services exclusively in the USA, the company addresses an important issue for Bitcoin investors worldwide. In the event of a sudden death, every Bitcoin investor should have a plan of what will happen to their Bitcoin.