MPC is short for multi-party computation, a cryptographic technology that allows shared information while maintaining data privacy. MPC improves traditional cryptographic technology because the involved parties can have data processed without involving a third party. In addition, data can only be accessed when all key fragment holders get together, meaning that no single person can access the data.
How long has MPC been around?
MPC was first launched in 1982, with a basic form of encrypted messages sent between two parties. 2PC launched the official MPC engine in 1982, which marked the start of the MPC journey. While MPC has been around for a few decades now, it only recently became an integral part of the digital asset space. Due to the privacy and accuracy aspects of MPC, it is an excellent technology for MPC wallet providers of digital assets.
Why is MPC Becoming the standard for Digital Assets?
Digital assets have both a private and a public key. To keep your assets secure, you need to ensure that your private key is kept confidential. Once someone else has access to your private key, they can also access your digital assets and transfer them to your wallet. Many hacking scams involve accidentally giving up access to your private keys, compromising your asset’s security, and allowing the hacker to empty your crypto account.
There are three main ways to store your keys:
Hot Storage – where the private key is held online.
Cold Storage – where the private key is kept offline.
Hardware Wallet – where the private key is stored offline on a physical device.
All three options have pros and cons, but the hardware wallet is considered the most secure option, especially if you have more significant amounts of crypto assets to protect. Hardware wallets do have a cost associated with buying them, and that amount will depend considerably on the option you choose. Still, for more significant amounts of Cryptocurrency, it is worth it to have the extra security. The good thing about a hardware wallet is there is also a seed phrase, so if for some reason you accidentally lose the physical wallet, you can access the crypto via your secure seed phrase.
MPC allows Cryptocurrency to function without a third party, which is a big part of the fundamentals of cryptocurrencies. Many cryptocurrencies were created as an alternative to traditional banking systems, and so this function of MPC allows them to operate as intended.
While MPC has been around for almost three decades now, it has become more prevalent with the invention of cryptocurrencies.