> For the complete documentation index, see [llms.txt](https://learn.cypherock.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://learn.cypherock.com/design-decision/using-shamir-secret-sharing-vs.-multi-sig/why-cypherock-has-a-default-2-5-threshold-scheme.md).

# Why Cypherock has a default 2/5 threshold scheme

{% tabs %}
{% tab title="Cypherock X1" %}
Cypherock X1 uses a cryptographic threshold scheme called Shamir's Secret Sharing to reconstruct the private key during runtime to sign a transaction that is deleted from the temporary memory as soon as the transaction is digitally signed. Cypherock X1 currently implements 2 of 5 Shamir's Secret Sharing. Hence a user today requires either 1 X1 Card and the X1 Vault, or 2 X1 Cards to reconstruct the Crypto private keys. An average user ideally keeps 2 of the cryptographic parts at home (both in separate rooms) and the remaining 3 parts away from home.

While considering all of the schemes, here are some insights that led us to finalize the 2/5 threshold design:

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## Enough redundancy to avoid loss while protecting against theft

There needs to be enough redundancy to avoid loss while protecting the user enough against the potential theft of private keys. This is where the current single-signature wallets fail and m/n threshold schemes help achieve this optimally. Human error tends to be the most prevalent reason for the loss of funds. Therefore, the 2/5 scheme created enough redundancy that the user can afford to lose cryptographic parts and still be assured that the Crypto assets are accessible. At the same time, it avoids a single point of failure for potential theft.
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{% step %}

## Balance security and wallet user experience

A threshold scheme of above 2/5, say, 3/5 would optimize for security but will come with a significant compromise on the wallet user experience. The 2/5 scheme avoids a single point of failure and provides exponentially more security than 1/5 and more convenience than 3/5 and above. With a 2/5 threshold scheme, the user still has the choice to keep the X1 Card and X1 Vault in the same place giving him a similar UX to current single signature hardware wallets, or keeping them as far away as possible to optimize for security.
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{% step %}

## Avoid a single point of failure for inactive parts

It is important there isn't any single point of failure for storing the Cryptographic parts which are going to be inactive and kept as backup. In 2/5 scheme, the remaining 3 are the inactive parts. With 2/5 scheme, users have the ability to mitigate single points of failure where the user can choose to keep 1 X1 Card in a bank locker, 1 X1 Card with a family member, and 1 X1 Card with a friend. These 3 personas have 3 different risk profiles for a user and hence mitigate the risks of a single point of failure even with inactive part storage.
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## Avoid a single point of failure in nominee selection

While inheriting the assets through Cypherock inheritance service (launching soon), it is important for the user to avoid a single point of failure in nominee selection. The user should be able to give two different cards to at least 2 different nominees so that even if one nominee is unavailable, the other one should be able to manage the recovery. At the bare minimum, then the average user needs to have 2 Cryptographic parts accessible to him at all times, 2 parts given to 2 different nominees and 1 additional part not easily accessible to the user and not given to any nominee as well.
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At present, Cypherock is not considering offering a custom threshold scheme, but that may change in the future.
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{% tab title="Cypherock X0" %}
Cypherock X0 uses the same 2 of 5 Shamir's Secret Sharing scheme to reconstruct the private key during runtime to sign a transaction. The private key is reconstructed inside the secure element of the X0 Card and is deleted from its temporary memory as soon as the transaction is digitally signed. With the 5 shards stored on the user's smartphone and the 4 X0 Cards, a user requires either their smartphone and 1 X0 Card, or 2 X0 Cards to reconstruct the Crypto private keys.

The same insights that led us to the 2/5 threshold design apply to Cypherock X0:

{% stepper %}
{% step %}

## Enough redundancy to avoid loss, while protecting against theft

Human error tends to be the most prevalent reason for the loss of funds. With the 2/5 scheme, the user can afford to lose up to 3 shards and still be assured that their Crypto assets are accessible, while no single shard is ever enough to steal them.
{% endstep %}

{% step %}

## Convenience for everyday use

Since the smartphone holds one of the 5 shards, everyday transactions only need the user's phone and any one X0 Card. A user can carry one X0 Card along with their phone for an experience as simple as a single-signature wallet, while the remaining cards are kept as backup.
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## No single point of failure for inactive shards

The 3 X0 Cards kept as backup are the inactive shards. With the 2/5 scheme, users can store them in 3 places with different risk profiles, for example one at home, one at their workplace and one in a bank locker. Any 2 of them are enough to restore the wallet on a new phone.
{% endstep %}
{% endstepper %}
{% endtab %}
{% endtabs %}