When setting up a Gnosis Safe, there are generally 3 decisions to take:
- How many owners?
- What threshold?
- Which owner wallets to use?
There is no single best answer to these 3 questions and no single Gnosis Safe setup that is the best. It really depends on the specific use case.
Nevertheless, this article tries to provide some pointers regarding what to consider:
How many owners?
It is generally advisable to use more than 1 owner account. When managing funds as a group that is a no-brainer anyway, since more than 1 person should have access. But even when managing funds as an individual, more than 1 owner account is advisable in order to have more than 1 authentication factor.
The threshold of a Safe specifies, how many owner accounts need to confirm a Safe transaction before it can be executed.
It is advisable to use a threshold higher than 1, so no single account can execute transactions, but instead there is always at least one more account required to verify and execute Safe transactions. Thereby, even in case an attacker gets hold of 1 account, they cannot move funds.
Besides that, it is good practice to use a threshold which is lower than the total number of owners of your Safe. Thereby, even in case one owner loses access to their account, users are not automatically locked out of all their funds in the Safe, but the other owners can still execute transactions and e.g. replace that lost owner account. You could argue that this is some kind of recovery mechanism.
Which owner wallets to use?
This depends on which owner wallets you are potentially already using. The Safe is compatible with Metamask, hardware wallets such as Ledger or Trezor and mobile wallets that support WalletConnect, such as Trust, Argent or Rainbow wallet.
You can also use the Gnosis Safe mobile app as one of your owners to sign transactions (https://gnosis-safe.io/#mobile). With this mobile app we are working on providing the best yet secure user experience when confirming transactions.
What are common Gnosis Safe setups?
Due to its popularity, a lot of Gnosis Safes are used with at least one Metamask owner. Metamask is followed by hardware wallets such as Ledger and Trezor. The Gnosis Safe mobile app is becoming more popular as owner wallet choice as well.
A common setup for individuals is a Safe with 3 owners (1 Metamask, 2 hardware wallets) and threshold 2. Metamask + one of the hardware wallets are used on a daily basis to sign and execute transactions. The second hardware wallet is locked up in a Safe place in case one of the other 2 owners is lost.
A common setup for groups managing funds collectively is using 1 owner account per individual and then using a threshold of 3. Thereby no single individual can execute transactions and all transactions are double-checked by 2 others. On the other side, not all owners are required to always confirm every single transaction which can be an advantage for time critical transactions.
In case different transactions or assets should require a different number of owners to confirm, we have seen organizations use different Safes with different assets and a different setup of owners and threshold.
Please refer to this article for information on how to create a Safe.