Six Reasons Presentation

1
Decentralized multi-signature solutions for
Bitcoin
2
Bitcoin?

• decentralized, peer to peer....
• no banks or 3rd parties needed
• secure system / everything with encryption
• somehow anonymous...
• -gt SO WHAT?

www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
3
Status Quo - Intermediary
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
4
Status Quo - Intermediary
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
5
Status Quo - Intermediary
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
6
Status Quo - Intermediary
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
7
Status Quo - Intermediary
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
8
Problem solved? Bitcoins

• Centralized Service??
• Give up control over my coins??
• Security issues with hackers?
• Sites close over night???
• -gt SAME PROBLEM AS BEFORE!

Exchange
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
9
Centralized services
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
10
Centralized services
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
11
Centralized services
Money goes via a CENTRAL bank account Bitcoins
go via central server
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
12
Centralized services
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
13
Get Bitcoins
What if a service exists where you.

• DO NOT give up control over your coins
• DO NOT allow even the administrators to
• access your coins
• IS NOT possible that Hackers can steal
• coins, even when the server is compromised
• DO NOT need to trust the trading party, as still
  an escrow is in place? EVEN when the site is
  closed?

www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
14
Decentralized services
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
15
Decentralized services
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
16
Decentralized services
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
17
Trick Multi-Signature wallets
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
18
Normal Transaction
How does it work?
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
19
Multi-Signature
Part 1 Create multi-signature address

• Get two or more Bitcoin addressees.
• Combine them using addmultisigaddress JSON-RPC
  command
• As a result, you will get a special Bitcoin
  address starting with 3.
• The resulting Bitcoin address is fully functional
  and can receive coins.
• You can create different combinations of M-of-N
  addresses. It means that you can specify how many
  private keys are needed to spend the coins.

www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
20
Multi-Signature
Part 2 Spending coins from multi-signature
wallets

• Create a transaction draft using
  createrawtransaction JSON-RPC command
• Sign the resulting transaction data with one of
  private keys, utilizing signrawtransaction
  command
• provide it with correct details, which may
  include public key and redeem script
• Pass partially signed transaction data to other
  party, which repeats this process
• Finally, you broadcast the transaction to the
  network (using sendrawtransaction
• or another means)

www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
21
Multi signature wallets
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
22
Multi signature wallets
encrypted
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martin_at_bitalo.com
23
Hackers and admins see encrypted wallets
encrypted
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
24
Two-Factor authentication
25
And the last resort Dead Mans Switch
encrypted
www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
26
Bottom line

• It IS possible to create REAL NO TRUST Bitcoin
  services
• Multi-Signature wallets, no one can ever access
  the bitcoins without your consent
• Thanks to MePIN two factor authentication not
  even if your PC is compromised
• With timed backup-transaction coins are even safe
  when service is closed down or server data is
  deleted

www.bitalo.com Phone [phone] e-mail
martin_at_bitalo.com
27
THANK
YOU
FOR watching