Litecoin Foundation has decided to use BitGo as a custody solution for the project funds.
Pleased to announce that we have chosen @BitGo multi-signature wallets for our #custody solution. #security #cryptocurrencies #payments #litecoin #LTC $ltc
— Litecoin Foundation (@LTCFoundation) January 3, 2020
The need arises from the fact that the system can provide solid guarantees as well as the possibility to use a multi-signature wallet, which makes sure that there is not only one person controlling the funds.
Indeed, a multi-signature wallet allows the management of a fund upon reaching a majority vote, together with other people included in the list of addresses authorised to manage that fund, so, for instance, the exit of the funds must be subject to the approval of all or the majority of the addresses.
The choice fell on the American company BitGo, based in Palo Alto, founded in 2013, which boasts fundraising of over $ 15 million thanks to the help of Goldman Sachs and Mike Novogratz. This company offers several services, including crypto custody, as it is a wallet that allows depositing and managing more than 100 different cryptocurrencies.
The same company is also covered by an insurance of up to $100 million in case of loss of funds.
This is positive news from a technical point of view, although perhaps fans of the blockchain concerned are unhappy, both because this will involve a significant cost that the foundation will have to sustain and because BitGo’s service requires identity verification, something that is in clear contrast with the progress that Litecoin wants to achieve in terms of privacy by integrating the MimbleWimble protocol.