BitGo Instant service has exceeded 19,000 transactions per week, for an average weekly transaction amount exceeding 10,000 Bitcoins, equivalent to $7M USD. BitGo Instant allows on-chain, zero confirm, instant transactions between participants. Companies using the service today include Bitstamp, BitQuick, CoinHako, Fold, Genesis, Korbit, Kraken, Paxful, ShapeShift, Unocoin and Wirex.
“BitGo Instant is one of the many engineering solutions that will make bitcoin more usable for business,” said Mike Belshe, CEO of BitGO. “The service adds speed and certainty to high volume transactions, micropayments, and other commerce that financial institutions, exchanges and users demand.”
Without BitGo Instant, transactions take 10–30 minutes to be recorded in a block by miners. Until confirmed in the blockchain, transactions are known as “zero-confirm” transactions, and are unsafe to rely on. Without BitGo Instant’s guarantee, it is possible for the sender to spend the money elsewhere before the transaction is confirmed. As a result, most bitcoin businesses require multiple confirmations to credit a deposit, which can take anywhere from 30 minutes to several hours. With BitGo Instant, funds can be available immediately after receipt.
“BitGo Instant helps immensely in speeding up transactions and making the UX superior for our users,” said Erik Voorhees, CEO of ShapeShift, the world’s fastest digital asset exchange. “We’ve been thrilled with the service and I’m happy to have BitGo as a partner.”
BitGo Instant wallets consist of 3 keys: one held by BitGo, one held by the user, and one held on behalf of the user by a third-party Key Recovery Service (KRS). Two signatures are required on every transaction on a BitGo wallet, and in the usual case this would be done by BitGo and by the user. BitGo, of course, will never co-sign a transaction which is a double spend. That leaves only the possibility of the user and the KRS conspiring to double spend. To prevent this, BitGo has contracts in place with any KRS it uses which requires the KRS to give BitGo advance notification of any signature it makes.
Using the multi-signature security model, BitGo can guarantee that transactions cannot be double spent. When BitGo co-signs a BitGo Instant transaction, BitGo takes on a financial obligation and issues a cryptographically signed guarantee on the transaction. The recipient of a BitGo Instant transaction can rest assured that in any event where the transaction is not ultimately confirmed in the blockchain, and loses money as a result, they can file a claim and will be compensated in full by BitGo.