{"id":2761,"date":"2022-07-22T11:45:00","date_gmt":"2022-07-22T09:45:00","guid":{"rendered":"https:\/\/liqwith.io\/?p=2761"},"modified":"2026-03-05T14:21:25","modified_gmt":"2026-03-05T13:21:25","slug":"the-non-custodian-investment-vault-technology-implemented-in-the-liqwith-dapps-makes-an-investor-journey-in-a-blockchain-powered-application-as-smooth-as-possible","status":"publish","type":"post","link":"https:\/\/liqwith.io\/nl\/the-non-custodian-investment-vault-technology-implemented-in-the-liqwith-dapps-makes-an-investor-journey-in-a-blockchain-powered-application-as-smooth-as-possible\/","title":{"rendered":"The \u201cNon-custodian Investment Vault\u201d Technology implemented in the Liqwith DApps makes an investor journey in a Blockchain-powered application as smooth as possible"},"content":{"rendered":"<p><div class=\"et_d4_element et_pb_section et_pb_section_0  et_pb_css_mix_blend_mode et_pb_fullwidth_section et_section_regular et_block_section\" >\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t<div class=\"et_pb_module et_d4_element et_pb_fullwidth_post_title_0 et_pb_post_title  et_pb_text_align_left et_pb_bg_layout_dark et_pb_featured_bg\"   >\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t<div class=\"et_pb_title_container\">\n\t\t\t\t\t<h1 class=\"entry-title\"><\/h1>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t<\/div><div class=\"et_d4_element et_pb_section et_pb_section_1  et_pb_css_mix_blend_mode et_section_regular et_block_section\" >\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t<div class=\"et_d4_element et_pb_row et_pb_row_0  et_pb_css_mix_blend_mode et_block_row\">\n\t\t\t\t<div class=\"et_d4_element et_pb_column_4_4 et_pb_column et_pb_column_0  et_pb_css_mix_blend_mode et-last-child et_block_column\">\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t<div class=\"et_pb_module et_d4_element et_pb_text et_pb_text_0  et_pb_text_align_left et_pb_bg_layout_light\">\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t<div class=\"et_pb_text_inner\"><div class=\"gk gl gm gn go\">\n<div class=\"ab by\">\n<div class=\"cf be fw fx fy fz\">\n<p id=\"08e4\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\"><strong class=\"ms gs\">The custodian Paradigm:<\/strong><\/p>\n<p id=\"a04b\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\">Here at Liqwith, we are building the next generation of financial infrastructure for managing an organization\u2019s equity via blockchain technology. By leveraging the <a class=\"af no\" href=\"https:\/\/ethereum.org\/what-is-ethereum\/\" rel=\"noopener ugc nofollow\" target=\"_blank\">Ethereum Blockchain<\/a> we can replace traditional trust functions like managing an equity portfolio or verifying an equity transaction. Traditionally these are functions that banks and notaries are performing. The use of the Ethereum blockchain leads to exponential time and money savings on typical equity transactions. However, this comes at a cost. Instead of having a bank or a notary acting as a <a class=\"af no\" href=\"https:\/\/en.wikipedia.org\/wiki\/Custodian_bank\" rel=\"noopener ugc nofollow\" target=\"_blank\">custodian<\/a>, the investor himself is now the guardian of his assets. This is new and daunting for an investor, but it is also the only way to ensure that his assets are 100% safe. To eliminate the fear of this new paradigm, Liqwith created a \u201cbest of both worlds\u201d solution called the Non-custodian Investment Vault technology.<\/p>\n<figure class=\"ns nt nu nv nw nx np nq paragraph-image\"><\/figure>\n<p id=\"8505\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\"><strong class=\"ms gs\">Executive summary:<\/strong><\/p>\n<p id=\"46f6\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\">Using the Non-custodian Investment Vault technology of Liqwith will allow investors to maintain absolute and sole control over their private keys. They can interact with smart contracts, without the risk of losing access to their wallet if they misplace the device containing the only copy of their private key. They will enjoy a \u201ccloud-like\u201d experience, as these investors will be able to access the same wallet (private key) from different devices, using a familiar email and password login mechanism from their existing browsers. There will be no need to install any third-party applications like <a class=\"af no\" href=\"https:\/\/metamask.io\/\" rel=\"noopener ugc nofollow\" target=\"_blank\">MetaMask<\/a> or <a class=\"af no\" href=\"https:\/\/www.ledger.com\/ledger-live\" rel=\"noopener ugc nofollow\" target=\"_blank\">Ledger Live<\/a>. Current solutions in the Ethereum ecosystem introduce friction into the onboarding process of Investors by placing the burden of creating a wallet on the investors, requiring them to install a third-party solution like MetaMask or Ledger before they can invest in an organization powered by the Liqwith Decentralized Application (DApp). Liqwith aims to eliminate that friction by offering a so-called Non-custodian Investment Vault or \u201cLight Wallet\u201d build into the DApp itself. If users are tech-savvy enough, it is still possible to use a third-party solution like Ledger or MetaMask. With the Light Wallet integrated, Investors can manage their private key inside their existing browser, letting them sign transactions, claim dividends, and participate in the voting process of a particular Organization. At the same time, an investor remains the sole owner of his private keys, as the Non-custodian Investment Vault architecture makes sure nobody can access the investor\u2019s unencrypted private key \u2014 besides the investor itself.<\/p>\n<p id=\"b608\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\">As a bonus, using this technology eliminates the regulatory requirements as described in the latest <a class=\"af no\" href=\"https:\/\/watsonlaw.nl\/en\/amld5-aml-crypto-business-eu-dutch-law\/\" rel=\"noopener ugc nofollow\" target=\"_blank\">AMLD5 directive<\/a> regarding wallet providers.<\/p>\n<p id=\"c27f\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\"><strong class=\"ms gs\">The investor journey:<\/strong><\/p>\n<p id=\"6808\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\">The average investor won\u2019t and shouldn\u2019t care about blockchain. To promote the mainstream adoption of the Liqwith Solution among large groups of investors we made sure that we abstracted away from the investor as much as we could without compromising security. However, it also meant that this abstraction could not extend to the management of their private keys.<\/p>\n<p id=\"e5cb\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\">Private key management is one of (if not) the biggest challenge for investors in an \u201cEthereum blockchain-powered\u201d investment platform. While custodial solutions on Ethereum Blockchain DApps can offer users an experience which feels very familiar to, for example, Crowdfunding platforms, we believe they are a step in the wrong direction, as \u201cSafe vaults\u201d are not safe if they hinge on a centralized service having access to the private keys of an investor. Alternatively, placing the burden totally on the shoulders of investors by requiring them to manage their private keys on their own is too demanding of investors who are not necessarily tech-savvy.<\/p>\n<p id=\"8f98\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\">By using the Non-custodian Investment Vault technology of Liqwith, investors enjoy a familiar experience (email and password login flow), without requiring them to install anything, while making sure they are the only ones able to access their vaults containing their digital assets via their private key. Besides, accessing the same private key on multiple devices is as simple as typing in their credentials on a new device.<\/p>\n<p id=\"5a2c\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\"><strong class=\"ms gs\">How does this Non-custodian Investment Vault technology work?<\/strong><\/p>\n<p id=\"e385\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\">Liqwith lets investors create an encryption key in their browser as soon as they make an account on a Liqwith DApp. Effectively, an Ethereum blockchain wallet is created and encrypted with the aforementioned encryption key. The wallet is then stored in a Liqwith DApp as a JSON Object encrypted with a password. All cryptographic keys are generated and managed by the investor in his browser, and all encryption is done locally on his device. Liqwith DApps are never in the position of learning an investor\u2019s cryptographic key. When the already encrypted data travels between the investor\u2019s device and a Liqwith DApp, it is encrypted and authenticated by TLS. A Backup Recovery Phrase (Mnemonic Seed) is derived to offer investors a means of resetting their password in case they forget it.<\/p>\n<p id=\"2937\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\"><strong class=\"ms gs\"><em class=\"oh\">Note: We cannot recover users\u2019 data if they forget AND their Password AND lose their Backup Recovery Phrase!<\/em><\/strong><\/p>\n<p id=\"54e0\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\"><strong class=\"ms gs\">Key take-aways:<\/strong><\/p>\n<p id=\"ba13\" class=\"pw-post-body-paragraph mq mr gr ms b mt mu mv mw mx my mz na nb nc nd ne nf ng nh ni nj nk nl nm nn gk bh\" data-selectable-paragraph=\"\">We strive to bring the best security architectures to investors who are not themselves security experts. Not everyone wishes to become a security expert, but an investor is entitled to security whether or not he seeks to understand how it works. He needs to be sure that his assets are safe and well protected. Concealing the necessary complexity of the design from investors when they just want to use a Liqwith DApp or manage their crypto funds is all well and good, but we should never conceal the security design from security experts, system and security administrators, or curious users. Security by transparency is something we value and live by.<\/p>\n<\/div>\n<\/div>\n<\/div><\/div>\n\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t<\/div><\/p>","protected":false},"excerpt":{"rendered":"","protected":false},"author":1,"featured_media":2766,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":"","_et_gb_content_width":"2880","footnotes":""},"categories":[26],"tags":[],"class_list":["post-2761","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/posts\/2761","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/comments?post=2761"}],"version-history":[{"count":7,"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/posts\/2761\/revisions"}],"predecessor-version":[{"id":3272,"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/posts\/2761\/revisions\/3272"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/media\/2766"}],"wp:attachment":[{"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/media?parent=2761"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/categories?post=2761"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/liqwith.io\/nl\/wp-json\/wp\/v2\/tags?post=2761"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}