New and Non-Custodial Wallet of Satoshi

[Pmalek]

Additional information has become available about Wallet of Satoshi's new non-custodial Lightning Network service and it has sparked a discussion whether it's non-custodial at all and to what degree. WOS will use Spark as its node operator, requiring a degree of trust in the operator. Spark is a statechain and not trustless. Allegedly, the statechain could collude with certain users to steal money if there are no honest operators.

The creator of Spark, Kevin Hurley disagrees with certain accusations. He says that Spark relies on a 1-of-n operators model that requires honestly at the moment of sending BTC over Lightning. Once that happens, no further malicious attempts can affect the money you sent.

You can follow the discussion here.

[NotATether]

Additional information has become available about Wallet of Satoshi's new non-custodial Lightning Network service and it has sparked a discussion whether it's non-custodial at all and to what degree. WOS will use Spark as its node operator, requiring a degree of trust in the operator. Spark is a statechain and not trustless. Allegedly, the statechain could collude with certain users to steal money if there are no honest operators.

The creator of Spark, Kevin Hurley disagrees with certain accusations. He says that Spark relies on a 1-of-n operators model that requires honestly at the moment of sending BTC over Lightning. Once that happens, no further malicious attempts can affect the money you sent.

You can follow the discussion here.

Spark, is that some sort of BTC-to-Lightning exchanger like Boltz?

In that case, I can see how it is not decentralized.

Obviously you need to have a large open channel backed with a lot of (your) other BTC in order to have the capability of being able to send sats to  someone else's Lightning node.

And not only that, but regulators could also gate-keep the process at the "Received BTC; Now send sats" stage.

[Pmalek]

Spark, is that some sort of BTC-to-Lightning exchanger like Boltz?

I don't know much about Spark. It's a Bitcoin L2 network that runs through Spark operators. The argument against it is that it's not non-custodial like Phoenix Wallet for instance. But Spark claims that users have full control on their own. This sounds more like a promise to me than how the system actually works because it's not trustless and the operators can act fairly or maliciously. It's centralized, giving them the control to change the code and steal funds if they wanted to.

[Pmalek]

BTC Sessions has created a new Wallet of Satoshi review in which they covered both the custodial and non-custodial aspects of the software among other things. One interesting takeaway from the review is how to switch between those two modes. The default wallet behavior when you install it is to be custodial, but there is a button at the bottom of the settings that allows you to change that. Click "Switch to Self Custody", and you can create a self custody wallet.

The non-custodial option seems region specific. I don't have it on my end. If you are interested, check if you can see it in your wallet.



This is the link to the YouTube review if anyone wants to watch it:
https://www.youtube.com/watch?v=3yQUhHdjNuc

[NABiT]

The non-custodial option seems region specific. I don't have it on my end. If you are interested, check if you can see it in your wallet.

It would seem so, I don't see it either.

[Z-tight]

The non-custodial option seems region specific. I don't have it on my end. If you are interested, check if you can see it in your wallet.

No, it is not region specific. I sent an email to support@walletofsatoshi.com to inquire about this, because i couldn't also find the option in my own wallet, and this was their reply:



So i went ahead to update my wallet to the latest version in the App store, which is version 3.1.7 (330), and now i can see the option of 'switch to self custody' in my wallet. So i think you should also update your wallet to this latest version if you are interested in this option.

[Pmalek]

So i went ahead to update my wallet to the latest version in the App store, which is version 3.1.7 (330), and now i can see the option of 'switch to self custody' in my wallet. So i think you should also update your wallet to this latest version if you are interested in this option.

I downloaded the latest version from the Play Store yesterday just before I wrote the previous post, but the option wasn't there for me. I did it a second time after seeing your post, and now it seems to be working. Perhaps the Play Store pushed an older version to my phone or there was another reason why it was unavailable yesterday. When I installed WoS yesterday, I accessed the store on my laptop. I thought that could be the reason why I got an older version, but that seems to be working fine as well now.

Weird. What's important is that it works. Cheers!

[Pmalek]

Interesting initiative by the Wallet of Satoshi team right now. After Square merchants started accepting Bitcoin through their POS systems, the WoS team has decided to run a giveaway. If you use Wallet of Satoshi at a Square merchant to pay for your lunch, WoS will reimburse the cost of the meal. To receive the giveaway, you have to record a video that shows you paying with WoS at a Square merchant. The offer is valid for only 24 hours. WoS will reimburse up to 100 participants with valid videos and up to $100 per person.

https://x.com/walletofsatoshi/status/1988007727076094062

[Pmalek]

Wallet of Satoshi has announced that they are turning completely non custodial. The old custodial service where you didn't have your own keys will be gradually retired. Creating new invoices is already possible in some areas and by the end of September it should happen worldwide.

Existing Lightning addresses will keep working. Users will still be able to receive coins to them. However, they won't be able to generate new invoices from custodial wallets once the transition happens. Users with custom addresses like "yourname@walletofsatoshi.com" need to contact the support to ask for help in retaining the addresses in the new non custodial wallets.

Sending sats over the old wallets will work until 30 June 2027. After the deadline, all balances have to be moved to the new non custodial wallets.

The deadline for businesses who use WoS for POS payments is much shorter. Once your region switches to the non custodial wallets, POS payments through the custodial wallets will stop working.

Source:
https://x.com/walletofsatoshi/status/2087729423969903068

[Charles-Tim]

I like this gradual transitioning.

Bitcoin lightning wallet should also be noncustodial, and Wallet of Satoshi is moving in the right direction. But it remains only one thing, will the wallet become open source?

There are many reputable bitcoin lightning wallets that are open source and good to use like Phoenix.

[Pmalek]

According to crypto advocate and content creator, Joel Valenzuela, the claim that Wallet of Satoshi is becoming non custodial is wrong. He says it won't enable full self custody of bitcoin in the wallet. That's because it's not Lightning, but a Spark wallet. WoS doesn't mention this in their announcement. Your coins on Spark are controlled by a group of 3 operators who can allow you or not allow you to move your money. He says a special "recovery bundle" is needed (that WoS doesn't provide), making transactions and exits to L1 possible only if the operators don't remove such permissions. Operators can also spy on transactions, which is bad for privacy.

He goes on to suggest Phoenix Wallet for users who want a simple non-custodial Lightning wallet.

Here is the entire post:
https://x.com/TheDesertLynx/status/2088698647454347688

But it remains only one thing, will the wallet become open source?

I doubt it.