The bitcoin crab
The bitcoin crab 1 minutes reading from Bitcoin

How to Build Trustless (Less Trustless) CEX/BTC Wallet

How to build a trustless (less, not 0 trust) CEX. It is also hacker resistent and add a 2FA. Rules: 1 - Only BTC

and shitcoins that allow multsign wallets availiable.

2 - Mandatory hardware wallet use.

1/3

3 - When signing up, mist plug hardware wallet. A list of wallets 2 out 2 multsign for each token is created. All client's 1/2 private keys can now only be decripted by signing with his his Bitcoin private key on the hardware wallet.

2/3

4-To sell token X for Y client signs transaction transfering X to buyer and buyer sign a transaction of Y to seller.

Exchange sign both 1/2 transactions at once

All parts can verify shitcoin or BTC balance. Safe, hacker can't get all money from exchange. You can add 2FA.

3/3

4/3 😅

To use fiat is also simple.

You sign transaction of crypto to buyer. Exchange waits untill you confirm received the cash on your trad fi bank. Then exchange signs the 2/2 transfer.

Pay transaction fee + insurance. Exchange is an arbrit when things go wrong. Never FTX

CEX bank account can't get frozen

CEX can't steal or lend your money without your consent, you must sign

If hackers get your keys, they must also get access to the exchange + 2FA

You can leverage by lending or borrowing using 2/3 mult sign. Where CEX + 1 liquidated can other🤔

This post is based on this twitter thread.

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