Towards New Self-Custody Best Practices

The concept of user-provided verifiable entropy is crucial in enhancing security, particularly in scenarios where trust in a single device is questionable. Utilizing two devices can significantly diminish the likelihood of both devices being compromised simultaneously, thereby offering a more robust security framework. This strategy is particularly beneficial for advanced users who may opt for multi-signature schemes such as 2-of-3 or 3-of-5 configurations. These setups are not designed as universal solutions but rather as optimal strategies tailored to prevent less technical or new users from potential fund losses due to common mistakes.

One prevalent issue among newcomers is the loss of passphrases, which poses a significant risk in managing digital assets. However, for more experienced users, employing passphrases can be a strategic choice. It allows them to manage multiple accounts under the same seed words without the need to alter derivation paths. This approach provides an added layer of customization and security for users who have a deeper understanding of the technical intricacies involved in cryptographic systems and asset management.