Single seed & passphrase with FOUR backups or 2/3 multisig?

[BitcoinClubMaster]

Hypothetically you have access to 4 secure locations. Which cold storage option below would you choose and why?

A single seed & passphrase with the steel seed backup in 2 locations and the passphrase backed up on steel in 2 other locations. Hardware wallet stored at both seed word backup locations, one of which is your home, using two different HWW vendors. Passphrase not memorised and all locations are geographically separated.

A DIY (none collaborative) 2/3 multisig wallet using 3 geographically separated locations to store a hardware wallet (each location has a different vendor), steel seed backup and micro SD & laminated paper with all of the required xpubs/config file.

The main two arguments I’ve heard against single sig & passphrase is that it’s a 2/2 setup increasing chance of loss and it’s not safe from a wrench attack if the passphrase is memorised or kept with the HWW/seed.

The above solution in option 1 addresses both of these arguments so I’m interested to hear your preference and why. The main concern is risk of loss or user error.

Let’s hear it.

[hatshepsut93]

The main two arguments I’ve heard against single sig & passphrase is that it’s a 2/2 setup increasing chance of loss and it’s not safe from a wrench attack if the passphrase is memorised or kept with the HWW/seed.

Nothing is safe from a $5 wrench attack so it shouldn't be a factor.

If you have access to 4 locations it could be better to make a 2 of 4 multisig, because then you can lose any two of them, while with two seed+passphrase sets you can lose coins if you lose both seeds or both passwords.

It really depends on how likely you are to lose backups. If your backup locations and storage methods are reliable, even having two is good enough.

[FatFork]

Option one (single seed & passphrase) requires four secure locations for redundancy (two hardware devices with backup seeds + two passphrases). You need access to two specific locations to access your funds (hw + passphrase), but at the same time, if an attacker gets a hold of any of your seed backups, he won't know that he also needs a passphrase to steal your funds. You can create a fake wallet (without a passphrase) and transfer a small amount of Bitcoin that you're comfortable losing.

Option two (2/3 multisig) requires storing a wallet in at least five locations (two hardware devices + three seed backups) or ideally six locations (three hardware devices + three seed backups). You need access to at least two separate locations to access your funds (hw1+hw2 or hw1+seed2 or some other combination). At the same time, at least two seed backup locations must be compromised for an attacker to gain access to your funds.

Personally, I like the first option better, mainly because of simplicity and better fault tolerance, but it is important to note that if you lose access to both locations with your passphrase, and passphrase is not memorized, your funds will be lost permanently.

[Catenaccio]

I store my bitcoins with different wallets and with different methods.

Single signature hot wallet.
Multisig wallet with 2/2 cosigner.

If you have more bitcoins, you can store your coins in more wallets with more setup methods like increase your co-signers for multisig wallets.

Assume you have ability to store your wallets, backups at different locations, up to four, you will have many options to store your wallets, backups up to four locations with different co-signer numbers like 2/2, 2/3 or 2/4.

With each wallet, co-signer, make proper backups.

How to back up a seed phrase?