Author: nathanw at tutanota.com 2019-04-02 16:53:11
Published on: 2019-04-02T16:53:11+00:00
Nathan Worsley, the CTO of LocalCoinSwap.com, has proposed that Bitcoin should have an "integrated address" feature. This feature would allow addresses to resolve into a Bitcoin address and a transaction message or identifier. According to Worsley, this feature would enhance the security of exchange cold-wallet systems by allowing them to receive all payments to a single address from multiple customers. It would also simplify the process of setting up and managing exchange cold-wallet systems.Worsley notes that although it would be nice to have all customers deposit directly into cold addresses, this becomes impractical when large numbers of customers begin to use exchange wallets as their personal web-wallets. Most exchanges now use the hot-deposit system, where customers deposit into a hot address that is then automatically swept into a singular cold address, by a service that holds customers' private keys online. An integrated address would allow all exchanges using this automated hot-deposit service to easily switch to a more secure alternative of having all customers depositing directly into their singular cold wallet address.In addition to enhancing security, the integrated address feature would have several other advantages such as lower fees for exchanges, less need for large rescans after loading huge amounts of customer addresses into client software, easier provisioning of deposit addresses to new customers in a secure manner, and easier verification for customers that no man-in-the-middle has given them an incorrect address to deposit to.Worsley proposes that the integrated address could work by combining the Bitcoin address with some kind of hex or other value, allowing users to choose the amount they wish to deposit themselves, but ensuring their deposits are uniquely trackable. He is not sure if this functionality already exists in BTC and is considering submitting a proposal to implement this feature, which he believes would be a godsend to all exchange developers if widely accepted.
Updated on: 2023-06-13T17:54:37.128948+00:00