Bitcoin Startup Casa Expands Beyond BTC With Ethereum Vaults

No longer a Bitcoin-only company, today Bitcoin wallet provider Casa released Ethereum vaults, aimed at giving ETH holders a more secure way of take control of their funds.

As the common refrain in crypto goes, "Not your keys, not your coins." Casa tries to make it easier and more secure for users to store their own funds via self-custody, rather than trust a third-party exchange with their funds.

Now they’re allowing users to store Ethereum too, partly because so many Bitcoin owners also own ETH. Casa pointed to a 2021 survey from Grayscale Investments, which found that 87 percent of Bitcoin investors own at least one other cryptocurrency. The firm first announced plans to expand to Ethereum last November.

Third-parties in crypto fail regularly, as shown most recently and prominently by last November’s downfall of exchange FTX. The once highly-regarded exchange ended up tapping user funds for other purposes, but then had a shortfall—and users still don't know if they'll get it all back amid the exchange’s bankruptcy process.

"Self-custody places the control and responsibility back into the hands of the users, eliminating the risk that people’s assets will be frozen, misused, or stolen when things go wrong at an exchange,” Casa CEO Nick Neuman told Decrypt.

“We believe that reducing reliance on third-parties by taking self-custody and holding your private keys is the future of money management,” he added.

Normally, a user has one private key securing their ETH or BTC. If a user loses this key, or a bad actor snoops and is able to find the key and exploit it, then the user's funds are gone forever. But Casa uses multi-signature technology, in which more than one key is used to secure the funds.

Casa typically uses a two-of-three multi-signature setup, where two of the three keys need to be used to send funds. This means that if a hacker finds just one of the keys, they can't send the funds anywhere. This requirement also adds more of a buffer for absent-minded users, because two of the keys need to be lost to lose their ETH or BTC.

With today's update, Ethereum holders can use Casa's technology to secure their funds as well, joining a few other ETH multi-sig products in the space—such as Safe.

Self-custody can be intimidating to users who worry about having the knowhow to secure their own funds. Neuman argued that Casa makes self-custody "surprisingly simple," because Casa guides users through the process of protecting their ETH or Bitcoin.

"Our app gives Casa members a clear view of their key health, and guides them through replacing a key if it is lost or stolen,” Neuman said. “It’s no more complicated than interfacing with any regular banking app, and we’re here to offer support and guidance at every step.”

For users who want to secure "significant holdings,” Casa also offers a plan with even beefier security, boasting a five-key vault with video verification and emergency support.