Using One Seed with Different Passphrases for Multi-Sig Setup

[santiagobrusco]

Hi.
I've been considering setting up a multi-signature (multi-sig) wallet to securely store my Bitcoin. However, I had a thought and wanted to get your opinions on this approach.

Instead of using multiple seeds and devices for a multi-sig setup, would it be feasible and secure to use a single seed phrase with different passphrases to create the multi-sig wallets? Here's my idea:

1. Start with a single seed phrase on one device (e.g., a Passport hardware wallet).
2. Use different passphrases in combination with that seed to derive multiple wallets.
3. Set up the multi-sig using the wallets derived from that single seed and the different passphrases.

For example, let's say I have a 2-of-3 multi-sig setup. I could use my single seed with three different passphrases to create three distinct wallets. When I need to sign a transaction, I would only need to use my single device, enter the appropriate passphrase, and sign.

The potential advantage I see is that I would only need to securely store and back up a single seed phrase, and I could avoid managing multiple seeds or devices. The passphrases would add an extra layer of security.

However, I'm not sure if this approach has any drawbacks or security implications that I'm overlooking. Is this a viable and secure way to set up a multi-sig wallet, or are there reasons why using multiple seeds and devices is preferred? Obviously, I’d safely backup both seed and passphrases. And I’d have a backup device from a different manufacturer.

I'd greatly appreciate any insights, advice, or considerations from the experienced members of this forum. Thank you in advance for your help!

[BlackBoss_]

One seed phrase combines with different passphrase will create different wallets but why do you need to apply this method.

If you want to set up a multi-sig wallet, with some co-signers, at least 2 co-signers, you actually prioritize your fund safety through the multi-sig wallet. If you apply this method, what do you think if people get access to your wallet seed phrase?

It is a first component of your co-signers, and if they get access to wallet seed phrase, you will have to pray that they won't get access to your extended phrase, that is a second component of your co-signers.

I could be wrong but setting up your co-signer wallets with completely different wallet seed phrases and different extended phrases is a safer way to set up your multisig wallet.

Creating a multisig wallet with Electrum

When you want convenience, you decrease security level. I connect your method with passwords, people can prioritize convenience and use same password everywhere or use different passwords but with same pattern and very minor differences.

1. There's a non-zero chance that randomness could generate a seed phrase exactly equal to mine.

By using 3 completely different seed phrases, you increase security because it is impossible to create 3 wallets with 3 wallet seed phrases as same as yours. One is difficult and combination of 3 will be impossible, it's how your multisig wallet security appears to protect your fund.

2. There's a non-zero chance that the seed could get stolen, and a single passphrase could be guessed or stolen (or even randomly generated).

It's reasons behind idea of creating and using multisig wallet, to avoid fund steal if one co-signer is compromised.

Here, you want to use 1 wallet seed phrase, do you see something wrong here from the idea?

I knew after that you will have extended phrase but is it better than 3 completely different wallets (cosigners) with different wallet seed phrases?

[santiagobrusco]

(deleted last own reply because it was AI translated and was wrong)
Ok, but to clarify, the multi-sig setup would be for my personal funds. I might be extremely paranoid, but my logic and assumptions are as follows:

1. There's a non-zero chance that randomness could generate a seed phrase exactly equal to mine.
2. There's a non-zero chance that the seed could get stolen, and a single passphrase could be guessed or stolen (or even randomly generated).

The chances of these scenarios are dramatically reduced if I have three different wallets (one per passphrase). However, instead of having to store three seed phrases (which would require a lot of locations), I store only one seed (which really needs only one location, plus one other for the device itself). Then, I remember or store somewhere else three passphrases and set up a multi-sig.

I could remember at least one of the passphrases.

The whole setup would make the chances of it being forcefully stolen or randomly generated almost zero.


Does this make sense ?

[santiagobrusco]

Yes. I think I see your point. Will have to come up with a better setup

One seed phrase combines with different passphrase will create different wallets but why do you need to apply this method.

If you want to set up a multi-sig wallet, with some co-signers, at least 2 co-signers, you actually prioritize your fund safety through the multi-sig wallet. If you apply this method, what do you think if people get access to your wallet seed phrase?

It is a first component of your co-signers, and if they get access to wallet seed phrase, you will have to pray that they won't get access to your extended phrase, that is a second component of your co-signers.

I could be wrong but setting up your co-signer wallets with completely different wallet seed phrases and different extended phrases is a safer way to set up your multisig wallet.

Creating a multisig wallet with Electrum

When you want convenience, you decrease security level. I connect your method with passwords, people can prioritize convenience and use same password everywhere or use different passwords but with same pattern and very minor differences.

1. There's a non-zero chance that randomness could generate a seed phrase exactly equal to mine.

By using 3 completely different seed phrases, you increase security because it is impossible to create 3 wallets with 3 wallet seed phrases as same as yours. One is difficult and combination of 3 will be impossible, it's how your multisig wallet security appears to protect your fund.

2. There's a non-zero chance that the seed could get stolen, and a single passphrase could be guessed or stolen (or even randomly generated).

It's reasons behind idea of creating and using multisig wallet, to avoid fund steal if one co-signer is compromised.

Here, you want to use 1 wallet seed phrase, do you see something wrong here from the idea?

I knew after that you will have extended phrase but is it better than 3 completely different wallets (cosigners) with different wallet seed phrases?

[Hatchy]

I'm not that familiar with a multi sign wallet set up, but from the little knowledge I have about it, i don't think it's feasible to have a multi signature wallet with same seedphrase or key. a single seed phrase cannot be used for a multisignature wallet. Each participant must have their own unique seed phrase and private key to sign any transaction.Thats why it's called a multisig wallet. The whole point is to makes it possible that the control over the wallet's funds is distributed among multiple parties enhancing security and preventing any single point of failure.

Using One Seed with Different Passphrases for Multi-Sig Setup

Using different passphrase on the same seed, will generate different wallets.