What are sub-accounts in Finrock
A sub-account is a secondary account nested within a larger primary (parent) account. It is used to separate funds or activities without the need for an entirely separate workspace (or primary account) login or legal structure. A sub-account has its own wallets, gas tanks, policies and permissions.
Finrock uses HD wallets for subaccounts, allowing a single client seed (entropy) to generate multiple subaccounts via unique derivation paths. This model provides efficient, secure key management while enabling unlimited client subaccounts via unique derivation paths.
Key Advantages
- Backup Simplicity: One seed phrase recovers all subaccounts across the client's entire hierarchy—no need to track multiple seeds
- User Convenience: Clients restore everything with a single 12-word phrase; subaccounts (m/44'/0'/0'/0/X) appear automatically in compatible wallets.
HD Wallet Basics
HD wallets derive all keys from one entropy source via BIP-32 paths like m/44'/0'/0'/0/0, ensuring subaccounts stay within that tree. Different paths under the same seed still share cryptographic lineage, risking linkage if compromised.
Segregation with Multiple Seeds
Unfortunately our sub-account system doesn't offer this feature; however, a client can have two or more workspaces (aka accounts) with Finrock to have more than one seed/entropy.
Using separate entropies (aka seeds) for HD wallets offers strong segregation benefits and may be needed for one or more of the following reasons.
- Regulatory Compliance: Isolates client assets from the company treasury, meeting segregation rules (e.g., MiCA and FCA-like standards) and simplifying audits/proof-of-reserves without shared key risks.
- Security Isolation: Compromise of one seed (e.g., hot client subaccounts) doesn't expose company funds; it enables distinct hot/cold storage per category.