Threshold Configuration Risks

Threshold configuration risks arise when the chosen M-of-N parameters are poorly aligned with the protocol's threat model. If the threshold is too low, the system is vulnerable to collusion among a small number of signers.

If the threshold is too high, the system may suffer from liveness issues where transactions cannot be signed due to unresponsive participants. Finding the optimal balance requires a deep understanding of the network's trust assumptions and operational requirements.

Configuration risks also include the failure to account for geographic or infrastructure diversity among signers. If all signers are hosted on the same cloud provider, a single provider outage could halt the protocol.

These risks must be actively managed through periodic reviews and adjustments to the threshold settings.