Multisig Vault Upgrade

This sections explains the technical architecture of the multisig vault upgrade, which was pushed to production on May 1st, 2024.

Multisig Vault Upgrade

The multisig vault upgrade was deployed as a part of our initiative to further scale, decentralize, and secure our wrapped Bitcoin protocol. These changes were done in line with the original article here.

Structure

The protocol works similarly as before, except now, each month we rebalance the hot and multisig vault so that 75% of all protocol BTC is in the cold storage multisig vault, which has 6 signers, and needs 4 signers to move any BTC. Three of the signers are from the core AnetaBTC team and the other 3 signers are reputable Cardano stake pool operators APEX, BBHMM, and NEXUS.

Our dashboard displays the amount of BTC in the hot vault and the multisig vault. All transactions are public and verifiable on both Cardano and Bitcoin ledgers.

At any given time, the amount of BTC freely available for redemption is the amount that is in the hot vault. In the event a user wants to redeem a larger amount than what is in the hot vault the protocol will see the failed transaction, and our multisig vault will manually process the transaction no later than 48 hours after the request. The user does not need to contact the team unless this 48-hour window passes and the redemption request still has not been processed. In that event, please create a ticket on Discord for active assistance.

Enhancing Security and Scalability

With any protocol changes, there are pros and cons to consider. The main con that we foresee is that this upgrade introduces a manual element when initiating large redemption requests. Previously, all transactions were processed automatically, however, in a centralized manner.

The pros of this upgrade are enhanced security and scalability as users can have more confidence in this cold storage multisig vault to hold a majority of BTC. This can open the door for users to bring more BTC into the ecosystem as they can foreseeably have more confidence in being able to verify that 75% of all BTC is moved into the cold storage multisig each month.

We consider this upgrade "AnetaBTC V1.5," not to be confused with AnetaBTC V2, which will introduce a 100% multisig vault operation and the ability to mint from any Bitcoin wallet with ease. More details on our V2 protocol can be found in section 6 of our litepaper.

Before interacting with the protocol, please be acutely aware of all security assumptions, which can be found here. Thank you to our community for your support and feel free to message us on Telegram or Discord with any questions.