Key Management is a system for keeping your keys safe. It may be supported by technologies such as CKM, CSR, or SSKR, but it’s also supported by the risk modeling found in Smart Custody and other best practices, some of which are discussed herein.
Why is Key Management Important?
There are no backups in the world of cryptographically secured digital assets. Your key (or your seed) is the only way you can claim your assets or manage your identity. If its gone, then the assets or identity are effectively gone as well.
We have a whole list of adversaries as part of our Smart Custody book, but many of them come down to two fundamental security flaws:
- Single Point of Failure (SPOF). You have a single copy of the single key controlling your assets, and you lose it.
- Single Point of Compromise (SPOC). You have a single key controlling your assets, and someone steals it.
How Does Key Management Work?
The fundamental solution to SPOFs and SPOCs is to ensure that the loss or compromise of a single key doesn’t cause the loss or compromise of your assets. This is done by backing up keys in secure ways and by creating scenarios where more than a single key is needed to control an asset.
You can:
- Back up your key as shards that don’t form SPOCs and that can be put together with a smaller threshold to avoid SPOF. (SSKR)
- Back up your shards to remote servers in an automated way. (CSR)
- Create a key as shards and use those shards for signatures without ever bringing the key together. (CKM
Even without these technologies, you can lean on best practices to help keep your keys safe.
Some of these key management techniques can be burdensome, which is why our Smart Custody book talks about risk analysis: this allows you to figure out which assets require higher levels of key management and which do not.
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