Key Elements of a Non‑Custodial Trading Wallet Recovery Plan

A non‑custodial trading wallet recovery plan must address how to restore control after a key loss, compromise, or unexpected system failure. It should outline secure key storage, emergency‑stop actions, and a clear process for verifying that balances and orders are consistent with the intended state. For related context, see Non-custodial trading for AI agents. For related context, see What Should an AI Agent’s Money Map Include?.

Why is a Dedicated Recovery Plan Necessary?

Because non‑custodial wallets place full asset responsibility on the owner, any disruption can lead to permanent loss if not handled methodically. A plan reduces uncertainty, limits exposure, and provides a documented path for restoring operations.

What Should the Key Management Section Contain?

Owner keys hold ultimate authority over withdrawals and policy changes, while agent keys are scoped for specific trading actions. The recovery plan must detail how each key type is generated, backed up, and rotated.

• ·Generate the owner key in a hardware security module or air‑gapped device; store the seed in multiple geographically separated vaults.
• ·Create agent keys with narrowly defined scopes (order size, daily notional, expiry) and keep their private material offline after deployment.
• ·Document the exact derivation path and any passphrase used so the key can be reconstructed if needed.
• ·Record the durable mutation identity for each key deployment to aid later reconciliation.

How Does an Emergency Stop Work?

An emergency stop revokes the calling agent key and cancels any managed activity that can be halted. It does not automatically close open positions or withdraw allowances, which must be reviewed by the owner.

• ·Define a trigger (e.g., detection of a compromised key, repeated transaction failures, or a security alert).
• ·Invoke the stop function to revoke the active agent key; log the mutation identifier and timestamp.
• ·Notify the owner immediately through a secure channel.
• ·Require a separate owner‑signed transaction to close positions or adjust token allowances.

What Role Do Durable Mutation IDs and Error States Play?

Because a timeout does not prove an order failed, the plan must capture explicit error codes and mutation IDs for every state change. This enables precise post‑mortem analysis and balance reconciliation.

• ·Log each order submission with its mutation ID, expected outcome, and any error returned by the venue.
• ·Store the full response payload, including timestamps and source identifiers.
• ·When a failure occurs, compare the recorded mutation ID against on‑chain or ledger records to confirm execution status.
• ·Use this data to reconcile any discrepancies before resuming trading.

How Should Market Data Integrity Be Verified?

Accurate market data is essential for safe order placement. The recovery plan must require source attribution, timestamp verification, and handling of missing or stale quotes.

• ·Require each data feed to include a source identifier and a freshness timestamp.
• ·Implement a check that discards quotes older than a configurable threshold.
• ·Log any warnings about data gaps and halt trading until fresh data is confirmed.
• ·Reference best practices in How a Trading Agent Should Detect and Respond to Stale Quotes.

What Steps Complete the Post‑Incident Reconciliation?

After the emergency stop is lifted and keys are restored, the owner must verify that the wallet’s on‑chain balances match the recorded state.

1. 01Retrieve the latest on‑chain balance snapshot and compare it to the internal ledger using mutation IDs.
2. 02Audit any open positions; if they were not automatically closed, decide whether to unwind them manually.
3. 03Re‑apply owner‑signed risk limits (order size, daily notional, loss caps) before re‑enabling the agent.
4. 04Document the entire recovery sequence for future audits.

A well‑structured recovery plan turns a security incident from a potential loss into a manageable process.