Multi-Party Computing (MPC)
Multi-Party Computing (MPC) is a cryptographic approach that enables multiple independent parties to jointly perform cryptographic operations without ever exposing or reconstructing the underlying private key. In the context of cryptocurrency custody, MPC eliminates the single point of failure inherent in traditional wallets by distributing trust across multiple participants or devices.
MPC has become one of the most important innovations for secure digital asset custody, allowing institutions to enforce governance policies, mitigate insider risk, and enable flexible operational models without compromising security.
Key Characteristics
Threshold key sharing
Instead of generating and storing a private key on one device, MPC protocols create cryptographic shares of a key that are distributed across multiple parties. Each party holds only its own share, and the full key is never reconstructed—not during storage, not during signing.
Distributed signing
When a transaction needs to be signed, each party uses its share to compute a partial signature. These partial signatures are then combined into a final valid signature that the blockchain recognizes as authentic. At no stage is the private key itself reconstructed, meaning that even if some shares are compromised, the private key never exists in any single place.
Policy and quorum enforcement
MPC wallets can enforce quorum policies such as “2-of-3 approvers must sign” or “at least one corporate and one external approver are required.” Because the protocol requires multiple shares to produce a valid signature, these policies are enforced cryptographically rather than relying only on organizational discipline.
Flexibility and resilience
MPC allows different shares to live in different environments—HSMs, secure elements, cloud servers, or end-user devices. Shares can also be backed by biometrics, passkeys, or automated trading engines (trading bots), depending on the client’s operational needs. This distribution enhances resilience against both hardware failure and targeted attacks.
Security Benefits
Elimination of single points of failure
No single system, administrator, or insider can compromise a private key. An attacker would need to compromise multiple independent parties simultaneously.
Resistance to theft and misuse
Because each share is mathematically meaningless on its own, exfiltrating one does not endanger the wallet. Attackers must compromise enough shares to meet the signing quorum, and even then, policy enforcement can block unauthorized use.
Cryptographic strength
MPC protocols rely on advanced mathematics (such as threshold signatures over elliptic curves) that produce signatures identical to those from a conventional private key. To the blockchain, the signature is indistinguishable from one generated in a traditional wallet.
MPC in Cryptocurrency Custody
Operational flexibility
Institutions can run hybrid custody models: for example, Secubit may hold one share in a secured HSM cluster while the client holds another on their own infrastructure. A transaction requires cooperation, making unilateral compromise impossible.
Integration with HSMs
MPC and HSMs complement each other. An HSM can safeguard one share, ensuring tamper-resistant protection and auditability, while other shares can be managed by client systems or user devices. This hybrid approach combines the benefits of hardware security with distributed trust.
Threat Model (MPC-Relevant) & Mitigations
| Threat | Mitigation (MPC) |
|---|---|
| Single device compromise | Key never exists in one place; shares alone are useless. |
| Insider misuse | Requires quorum of approvers; policies enforce separation of duties. |
| Cloud provider breach | One share alone is insufficient; attacker must also compromise other locations. |
| Hardware tampering | Shares may be stored in HSMs or secure enclaves with tamper-resistant controls. |
| Network interception | Protocols exchange only masked or encrypted values; no key material in transit. |
How Secubit Uses MPC
Secubit leverages Multi-Party Computing as a foundational layer of its Wallet-as-a-Service (WaaS) platform. In custodial mode, Secubit may hold all key shares within HSMs but still enforce quorum approvals before signing. In non-custodial or hybrid models, Secubit stores one share in its HSM network while the client holds another, protected by user biometrics, passkeys, or automated trading systems.
By combining MPC with tamper-resistant HSMs, Secubit ensures that keys are never reconstructed, policies are enforced cryptographically, and governance remains both secure and flexible. This enables institutions to adopt custody models that fit their risk tolerance while maintaining bank-grade security.