The Advanced Security Guide

Fuse is designed to mitigate many of the security risks associated with traditional wallets such as Phantom, Solflare, and Backpack.

To fully leverage these security features, users should follow several best practices.

This guide outlines the steps to optimize your wallet security.

Smart Wallet Basics

Traditional wallets such as Phantom, Solflare, and Backpack are browser extensions and mobile apps that control your onchain assets with a single key pair, use seed phrases for recovery, and are connected to the internet. They are gateways to the application ecosystem and often support multiple blockchains. However, traditional wallets come with security tradeoffs:

• Single points of failure: Traditional wallets rely on a seed phrase and a single key pair (a private and public key). Seed phrases are used to recover access to your wallet, and the private key is the object authorized to sign transactions for your account. If someone gets access to your seed phrase or key pair, they control your assets.

• Lack of customization: Traditional wallets don't allow for custom logic, specific rules, or parameters for onchain interactions. You get the same exact tooling and security as everyone else, regardless of your individual needs.

Fuse is a smart wallet built on Solana’s leading smart account standard—Squads Protocol—creating a secure vault for your onchain assets. Fuse replaces seed phrases and single key pairs with a 3-key system: Device, 2FA, and Recovery Keys.

This multisig configuration removes any single point of failure and prevents unauthorized access to your funds. Fuse also lets you rotate keys and enables seamless wallet recovery, and offers native swaps, staking, and DeFi integrations for stablecoin yield.

To summarize, Fuse is purpose-built for storing and compounding your long-term assets, while traditional wallets are gateways to the app ecosystem. 

Security Best Practices

To maximize the security of your Fuse wallet, here are key steps to follow.

Onboarding

When you first set up your Fuse wallet, it comes with two initial keys: a Device Key and a 2FA Key. Both have full authority to initiate, approve, and execute transactions. The initial 1/2 signing threshold means only one key is required to approve transactions.

For enhanced security, add at least one Recovery Key (up to three). This upgrades your Fuse wallet to a '2-of-n' signing threshold, where 'n' is your total number of keys. For example, adding one Recovery Key creates a 2/3 threshold, requiring two keys to approve transactions.

Recovery Keys have "approve-only" authority—they can only approve a recovery transaction in the scenario where you lose your Device or 2FA Key. Even if an attacker obtains all of your Recovery Keys, your funds remain secure since they cannot initiate or execute transactions without a Device or 2FA Key.

Risk minimization

1. Key distribution: By default, your Device Key is tied to your iPhone, and your 2FA Key is stored in iCloud. To further enhance security, upgrade your 2FA Key from iCloud to a Ledger after setting up the Fuse app. This does reduce convenience, as you need access to your Ledger to approve transactions, but you can use Spending Limits to enable seamless transfers that don’t require your 2FA Key.

2. Key management: Add multiple Recovery Keys using different hardware wallets (e.g. Trezor and Keystone) to diversify vendor risk.

3. Wallet diversity: Fuse is the most secure wallet for your Solana assets, but we recommend never keeping all your funds in a single place. Secure a portion of your funds in a hardware wallet or other self-custody solution to ensure wallet diversity.

Advanced recovery

Fuse provides multiple recovery options to ensure continuous access to your onchain assets.

While we don't anticipate any issues, here's how you can access your funds even if Fuse is removed from the App Store:

Scenario 1: The Fuse app is still on your phone.

Simply transfer your funds to another wallet.

Scenario 2: The Fuse app is no longer on your phone.

Complete both of the steps below before this scenario occurs.

1. Export your 2FA Key from iCloud or upgrade it to a Ledger after setup.

2. Create a Recovery Key using a wallet such as Phantom, Backpack, or Ledger.

After completing both steps, you can recover your assets through Squads App or its open-source interface via Squads Recovery Kit. While Scenario 2 is highly unlikely, preparing for it ensures you'll always have access to your onchain assets.

Get Started Today

It’s never too early to think about wallet security. To get started, click here to download Fuse. Make sure to also join our Telegram group and visit the Fuse Support Center.