"It's Time to End the Cold Storage Ice Age and Adopt Multi-Sig" A talk by Will O'Brien, CEO of BitGo, at Inside Bitcoins 2014.

2. Who Am I?
• Will O’Brien
• CEO & Co-Founder of BitGo
• FinTech, trading platforms and capital markets
• Startups and mid-size companies in consumer,
payments, video games, and media
• Computer Science, Harvard; MBA, MIT Sloan
• Obsessed with Bitcoin since 2012
2 COPYRIGHT © 2014 BITGO, INC.

3. BitGo: Securing the World’s Bitcoin
Leading Bitcoin security platform and pioneer in
multi-sig technology
Launched the world’s first multi-sig wallet in August 2013
$14m in total funding from veteran investors and finance
luminaries
3 Copyright © 2014 BitGo, Inc.
Our products:
• BitGo Enterprise
• Platform API/SDK

4. What Types of Customers Use BitGo?
Why They Choose
BitGo: Family office
investors
Hedge funds
Bitcoin miners
eCommerce
companies
Marketplaces
Exchanges
• Secure storage &
transactions
• Corporate treasury
policies
• Multi-user wallets
• Financial reporting &
audit capabilities
4 Copyright © 2014 BitGo, Inc.

5. “This is the year of the multi-signature wallet.”
-- Gavin Andresen, chief scientist of the Bitcoin Foundation, May 2014
5 Copyright © 2014 BitGo, Inc.

6. 0.831%
source: p2sh.info
% of all bitcoins stored in multi-sig wallets
6 Copyright © 2014 BitGo, Inc.

7. We Know Security is a Fundamental Threat
“$1.2M hack shows why you should never store bitcoin on
the internet.”
“From treasure to trash: Man tosses out bitcoin wallet on
hard drive worth $9 million.”
“To achieve wider adoption, bitcoin needs to address
significant issues related to security…Mt. Gox was like a bank
storing valuables in the lobby entrance.”
“Some see the security issues as teething pains, but it is
possible that the security of the core transactions technology
will be outweighed by the insecurity around the core...almost
10% of all Bitcoins have been stolen or seized as part of a
criminal venture in the last year.”
7 Copyright © 2014 BitGo, Inc.

8. Does This Even Qualify as “Digital” Currency?
The Bloomberg reporter opened up his paper
wallet to show the private key, and, not too
surprisingly, the funds were quickly stolen. “
”
8 Copyright © 2014 BitGo, Inc.

9. We Need a Secure Bitcoin Ecosystem
Consumer
Financial
Services Payment
Processing
Apps
9 Copyright © 2014 BitGo, Inc.
Wallets &
Vaults
Trading &
Exchanges
Mining

10. Multi-Sig: The Digital Equivalent of a Safe
Deposit Box
Multi-sig!  335Zc8furTKgD32bWewYwGYGai7sMrtKse
19frDKN7XwWL2wwhz35as7PtRFcL4vCNYG
10 Copyright © 2014 BitGo, Inc.
Not multi-sig 

11. Multi-Sig Solves the Trade-Off of Security
and Ease of Use
Security
11 Copyright © 2014 BitGo, Inc.
high
Ease of Use
desktop
wallets
low
low
high
multi-sig
wallets
hosted wallets, vaults
& exchanges
(single key cold storage)
paper wallets offline storage
brain wallets

12. Single Key vs Multi-Sig Wallets
Single Key Threat Vector Multi-Sig Solution
Customer loses private key or
password
Recover wallet with Backup Key
Customer’s login credentials stolen
2-factor authentication and fraud
detection
Server key stolen or service provider
unavailable
Customer still has 2 keys and can
transact directly on the blockchain
Malware, fraud or insider theft within
customer’s organization
Service layer corporate treasury
policies: spending limits, whitelisted
addresses and secondary approvals
12 Copyright © 2014 BitGo, Inc.

13. 13 Copyright © 2014 BitGo, Inc.

14. 14 Copyright © 2014 BitGo, Inc.

15. 15 Copyright © 2014 BitGo, Inc.

16. 16 Copyright © 2014 BitGo, Inc.

17. 17 Copyright © 2014 BitGo, Inc.

18. Call to Action for the Industry:
Embrace Multi-Sig as a Standard
• Based on P2SH (BIP 16)
• Build it internally or use a security platform provider
Key Tenets:
• Funds held on blockchain in multi-sig, not in cold pools
• Maintain independent auditing of holdings
• Enable customer segregated accounts (where appropriate)
• Set corporate treasury policies and protections
• Leverage security of multi-institutional key distribution
– Use a 3rd party co-signer on transactions
– Store backup key with a custodian
18 Copyright © 2014 BitGo, Inc.

19. Analogy: Origins of SSL the Standard
19 Copyright © 2014 BitGo, Inc.

20. Case Study: Enterprise Corporate Holdings
Customer needs enterprise-grade security for its
bitcoin holdings and outside auditor views
• Create a BitGo multi-sig wallet for your corporate holdings. Set low
spending limits for additional security.
• Add officers as administrators on the wallet. Add members of the Finance
team as spenders. Add outside auditors as view-only.
• Use reports for monthly financial statements.
20 BitGo, Inc. Confidential

21. Bank-Grade Software for Bitcoin
Multi-user enterprise wallets with network fraud detection,
spending limits, whitelisted addresses, approval chains and
financial reporting
Corporate Holdings
Wallet
Accounts Payable
Wallet
Marketing Dept.
Wallet
Wallet purpose Primary holdings Pay suppliers and
vendors
Advertising
payments
Spending limit $100,000 $10,000 $5,000
Admins CEO, CFO, COO CFO, VP Finance,
Dir. Accounting
CFO, VP Finance, VP
Marketing
Spenders VP Finance Members of Finance
and Accounting
teams
Members of
Marketing team
Auditors Financial analyst,
outside auditor
Financial analyst,
outside auditor
Financial analyst,
outside auditor
21 Copyright © 2014 BitGo, Inc.

22. 22 Copyright © 2014 BitGo, Inc.

23. 23 Copyright © 2014 BitGo, Inc.

24. 24 Copyright © 2014 BitGo, Inc.

25. 25 Copyright © 2014 BitGo, Inc.

26. Case Study: Trading Operations
Customer needs the ability to share wallets with
pre-set rules to initiate transactions
• Create a unique BitGo wallet for each trading partner
• Add your trading partner to the wallet to spend and approve transactions
• Queue orders by depositing BTC in the wallet. When a price is hit, the
trader can withdraw from the wallet
• Spending limits can be set to require secondary approval for large orders
• Reconcile trades at end of period using BitGo reporting
26 BitGo, Inc. Confidential

27. Case Study: Multi-Sig Custodial Accounts
• Remittance
• Escrow
• Auctions
• Real estate
27 COPYRIGHT © 2014 BITGO, INC.

28. After Multi-Sig: Future of Bitcoin Security
• BIP 32 HD (hierarchical deterministic) wallets
• Corporate treasury policies
• Industry standards for managing keys
• Hardware fobs and security modules
• Multi-institutional models of trading and settlement
Read more….
https://medium.com/@willobrien/its-time-to-end-the-cold-storage-ice-age-and-adopt-
28 Copyright © 2014 BitGo, Inc.
multi-sig-8589733c9fd6

29. Thank you.
will@bitgo.com - @willobrien
sales@bitgo.com - @BitGoInc
29 Copyright © 2014 BitGo, Inc.