Account and Key Management

This section covers the best practices for managing DAO member accounts and cryptographic keys to ensure security and control.

Account and Key Management: Introduction

The security of accounts and keys is a cornerstone of a DAO’s integrity. Mismanagement of keys can lead to catastrophic security breaches, so understanding how to securely manage accounts and keys is crucial for maintaining the DAO’s operations and trustworthiness. This section covers the key aspects of account and key management: Use of EOAs, Multisigs, and Smart Contract Wallets We’ll explore different types of wallets used in DAOs, including externally owned accounts (EOAs), multisig wallets, and smart contract wallets....

Use of EOAs, Multisigs, and Smart Contract Wallets

Effective account and key management is crucial for DAO security and governance. This section explores the three main types of wallets used in DAOs: Externally Owned Accounts (EOAs) – Simple wallets controlled by a private key. Multisig Wallets – Require multiple approvals for transactions. Smart Contract Wallets – Programmable wallets with advanced security features. Each wallet type has distinct trade-offs in security, decentralization, and usability. Externally Owned Accounts (EOAs) An EOA is a standard wallet controlled by a single private key, typically managed through wallets like MetaMask, Ledger, or Trezor....

Security Practices for Key Management

Proper key management is critical for DAOs to prevent unauthorized access, mitigate risks, and ensure continuity. Let’s explore best practices for storage and backup, rotation and recovery, access control and key generation. Secure Key Generation Best Practices Consider using a hardware wallet (e.g., Ledger, Trezor) to generate and store keys. Generate keys offline using trusted, air-gapped devices. Use a strong, unique passphrase for added security. Avoid storing private keys on internet-connected devices....

Mitigating Risks of Key Compromises

A compromised key can jeopardize DAO funds, governance, and operations. Let’s explore strategies to prevent, detect, and recover from key-related security incidents. Preventing Key Compromise Best Practices Use hardware wallets for signing transactions. Store private keys in cold storage for critical operations. Require multisig approvals for high-risk actions. Implement role-based access control (RBAC) to limit key usage. Regularly update firmware and security patches for wallet devices. Common Pitfalls to Avoid Using a single signer for critical operations....