1. Decentralized multi-signature solutions for Bitcoin

2. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Bitcoin? - decentralized, peer to peer.... - no banks or 3 rd parties needed - secure system / everything with encryption - somehow anonymous... --> SO WHAT?

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4. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Status Quo - Intermediary

5. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Status Quo - Intermediary

6. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Status Quo - Intermediary

7. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Status Quo - Intermediary

8. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Problem solved? – Bitcoins - Centralized Service?? - Give up control over my coins?? - Security issues with hackers? - Sites close over night??? --> SAME PROBLEM AS BEFORE!

9. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Centralized services

10. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Centralized services

11. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Centralized services Money goes via a CENTRAL bank account Bitcoins go via central server

12. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Centralized services

13. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com What if a service exists where you…. Get Bitcoins - 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?

14. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Decentralized services

15. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Decentralized services

16. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Decentralized services

17. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Trick: Multi-Signature wallets

18. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com “Normal” Transaction How does it work?

19. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Part 1: Create multi-signature address Multi-Signature -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.

20. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Part 2: Spending coins from multi-signature wallets Multi-Signature -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)

21. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Multi signature wallets

22. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Multi signature wallets

23. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com Hackers and admins see encrypted wallets

24. Two-Factor authentication

25. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com And the last resort: Dead Man’s Switch

26. www.bitalo.com Phone: +49 6322 9419292 | e-mail: martin@bitalo.com 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

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