In this article we will review the variations of wallet you can generate and import on Lincoin and what it means for you, your organization and your code in terms of security and efficiency.
Lincoin provides degrees of freedom in different layers of wallet accessibility as we believe every wallet has benefits and specific use-cases and there is no perfect one. Our default service works based on Segwit as we consider Segwit as a more secure and scalable solution. If segwit is not your preference you may still use Lincoin however generation transactions should be handled on your end.
- Private Key Storage:
Using Lincoin you can choose how and where you would like to store your private keys. Private key is tool to access and manage your funds and depending on your use-case you may require it to accessible on a server to be secured in a physical vault.
Lincoin-Hosted Wallet: You may ask Lincoin to encrypt, secure and store your private key so that you can have it ready whenever required. This type of storage is called Lincoin-Hosted. This method is recommended whenever you need to transact on your wallet frequently or you want setup an automated TX (Transaction). Hosting your private keys on Lincoin does not necessarily mean we can control our wallet. You can still use LINC technology on Derivation Path level to store your private keys on Lincoin and have full control on your funds. There are There several applications that this type of storage is used for.
- For instance, you are building a crypto-exchange and you sending and receiving funds very frequently. You can use a Lincoin-Hosted wallet as your hot-wallet.
- In another use case a merchant or group of merchants can use a Lincoin-Hosted wallet on a Lincoin payment gateway. By doing so they are able to split the revenue before it hits their wallet. Also a merchant or a crypto-exchange can setup an automated TX to set an upper threshold on the balance of their wallet and send the excess fund to their cold wallet immediately after their desired conditions are met.
Self-Hosted Wallet: Self-Hosted wallet are for those seeking security and privacy at all costs. By using the Zero-Knowledge self-hosted wallet you are in charge of securing your private keys and no one else but you knows the secret to access your cryptoassets. In this case Lincoin automated transactions are not possible through Lincoin however other functionalities are still possible. You may store the private keys on your own servers and use Lincoin as a link to blockchain to create your own transactions, sign them with your private keys in your own environment and broadcast them to the network through Lincoin.
- The Self-Hosted wallet can be your cold wallet set on your hardware wallet. Simply setup a payment gateway or create a monitoring request on your wallet through Lincoin. In this case you can have maximum security on your funds while still being able to have a payment gateway or receiving alerts on the activities of your wallet.
- The Self-Hosted wallet can be your wallet on another platform such as a crypto-exchange. Setup a payment gateway on your exchange wallet and receive payments directly on your exchange account for immediate conversion to stable coins or fiat.
- HD wallet functionalities are available for Self-Hosted wallets. Simply import your XPub key and we will handle the HD wallet activities such as generating a new address for every new payment request.
- Derivation Path Pattern:
By using Lincoin you can define your personal derivation path for wallet addresses. Derivation path is a security level that is commonly ignored. Let consider worst case scenarios; if your servers are hacked or private keys are compromised if the hacker does not have access to your derivation path pattern you funds are 100% secure. Wallets commonly use standard derivation path patterns as required by BIP44 to simplify recovery of your wallets but in specific cases you can take advantage of custom derivation path for enhanced security. Lincoin lets you use all and every derivation path possible including BIP32, BIP39, BIP44 or any other custom path you would like to employ.
- Address only wallets: Not every use-case requires you to share so much information. In a specific use-case you may only need to share an address of a wallet. Lincoin supports address only wallets that can be used for monitoring activities or sent automated transactions to. This can be your cold wallet address.
Our team at Lincoin are constantly working toward improving our service to address our business partner needs and to become the industry standard solution for Wallet as a Service. You can get started for free now and discuss your specific use-cases you have in mind. We believe in co-creating the future.